Can I pay rent to parents if I sell or gift my house to parents?

POSTED BY sandeep6883 ON February 19, 2015 4:26 pm NO COMMENTS

I booked a property in Aug 2010, The loan got approved & disbursed in Mar 2011. Now the possession is expected in Mar/Apr 2015.

Now, I got to know that if i sell the house before possession I will get LTCG & indexation benefits. However if I sell it after possession I will have to bear STCG (30% slab)

So a friend suggested that I should sell this house, gift the sale amount to my parents and buy a new ready to move house in my parents name. This will let me & my wife claim HRA benefits by paying rent to parents(both of us are in 30%slab)

However, I was wondering if I can simply register the house in my parents name or even better to sell the house to them? I can get LTCG, and HRA benefits both.

BUT I’m not sure if this is legally correct.

Please guide.

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