Can a Minor Buy Property?

To secure my 14 yrs old son’s future, I was planning to buy a property in his name. Can minor purchase property- this query kept coming in my mind. On consulting a property advocate I got to know that a minor can only acquire ownership of property through gift, as per the Transfer of Property Act 1882. 

What is the Minimum Age to Own a House?

The property advocate highlighted that the minimum age to own property in India, and carry out any property transaction is more than 18 years. 

According to the Indian Majority Act of 1875 and the Indian Contract Act of 1872, 

• A minor who is younger than eighteen is not allowed to sign any documents pertaining to real estate transactions. 

• It can only be completed when the minor is lawfully under the care of a guardian or parent who is authorised to sign.

• A minor is limited to the ownership of two properties under the provisions of the Indian income tax legislation. In such circumstances, the taxation portion will not be imposed, and he/she will be free to enjoy the profits from the assets.

• The income generated from the gifted property that is being used by the minor and his/her family is not subject to taxes. 

• There is a standard deduction of thirty percent from the rent amount when a property is rented out while being supervised by a guardian.

This information helped me a lot in carrying out the property transaction in the name of my son.

Read More:

Just a few days ago I saw a news report that Ruhaanika Dhawan bought a house on her own. I believed that the legal age for buying property in India was 18 so this news was surprising. I could not understand how she bought it so I started finding the answer. I read about minor property rights in India and then understood how she did it. Let me put your mind at rest with a detailed answer on the matter here.

Can a minor buy property?

A minor cannot buy a property unless his/her guardian or a parent signs the documents. In short, the person taking care of the child should take legal responsibility for the property as well. There are two ways by which a minor can buy a property- 

• By Bare Trust: a beneficiary rightfully owns another’s property 

• By Discretionary or Life Interest Trust- a way by which instead of a person, the entitlement is given to a group of people and named as potential beneficiaries of the trust.

Absolutely not. As per Section 8(2) of the Hindu Minority and Guardianship Act, 1956, the guardian or parent cannot sell or transfer the property without the

previous permission of the Court. 

So, in short, the legal age for buying property in India is 18 years but yes a minor can buy a property if the deal is finalised and is legally handled by the guardian.