• Capita Gain tax

My father had purchased a land (mango orchard) in the year 1958. My mother , five sisters and I are the heir of my father. We got this ancestral land after my father's death in 1979. In the year 2003 my mother and my five sisters have gifted me their full shares by a gift deed. Now I want to sale the land and to buy a flat using the money.
My questions are:

1) Is the long term Capital Gain tax applicable in this case?

2) Is there any relief from Capital Gain tax if I buy a flat in my name or in my wife's name or in my name and my wife's name with this money before one year or within two years from the sale of the land?
Asked 10 months ago in Property Law from Malda, West Bengal
Religion: Hindu

1) sale of land would attract long term capital gains 

 

2) you can reinvest sale proceeds by purchasing flat in your name or in joint names with your wife 

Ajay Sethi
Advocate, Mumbai
66757 Answers
4037 Consultations

5.0 on 5.0

1. Yes the long term capital gain tax are applicable if the land is Non-agriculture. Further in case it is agricultural land in Rural area there will no capital gain applicable. 

2. Yes you can get exemption in case there is capital gaiin on purchase of house property with condition either you are owner or co-owner and the net consideration recieved is invested.

Shubham Jhajharia
Advocate, Ahmedabad
19206 Answers
75 Consultations

5.0 on 5.0

1) Yes the long term capital gain tax will be applicable according to Index ratio you need to pay tax.

2) If you purchase property from it than no need to pay tax. Try to purchase flat on joint name you and your wife.

Ganesh Kadam
Advocate, Pune
7453 Answers
65 Consultations

4.9 on 5.0

 

An immovable property received as a gift, when sold, will be subject to capital gain tax on the capital gain earned on the sale. For the purpose of determining the capital gains, the cost of acquisition will be taken to be the cost to the last owner who purchased it. Also, the holding period will be considered to be the entire period starting from the date when such owner first held it, cost calculated on basis of  inflation index

Exemption under section 54 is available when the capital gains from the sale of property are reinvested into buying another property.

 

The new property can be purchased either 1 year before the sale or 2 years after the sale of the property. The gains can also be invested in the construction of a property, but construction must be completed within three years from the date of sale. 

You can buy  on your name  or jointly 

Dimple Jain
Advocate, Jodhpur
222 Answers

Not rated

Long term capital gain is applicable in this case and you will not be able to get any relief for purchase of flat so you have to pay the capital gain tax to the government @ 10% + surcharge @ 3%

Vimlesh Prasad Mishra
Advocate, Lucknow
5485 Answers
17 Consultations

4.9 on 5.0

An asset that is held for more than 36 months is a long-term capital asset. 

Mohammed Mujeeb
Advocate, Hyderabad
10125 Answers
3 Consultations

4.5 on 5.0

1. You can claim exemption from paying CGT u/s 54 of income tax act

2. You can either buy new house in your sole name or in joint names of you and your spouse

3. The investment in new house has to be made within stipulated period to avail the exemption 

Yusuf Rampurawala
Advocate, Mumbai
4448 Answers
25 Consultations

5.0 on 5.0

Dear Client,

Capital Gain tax applicable and can be excempted by using entire sale proceed to purchase ONE house within 1 yr before the date of transfer or 2 yrs after or construct ONE house within 3 yrs after the date of transfer.

Excemption permitted even if the property has been purchased in the name of a close relative.

Yogendra Singh Rajawat
Advocate, Jaipur
13088 Answers
15 Consultations

4.6 on 5.0

1.  LTCG can be claimed ONLY & ONLY by a person who has shown the property in its Income Tax Returns.

2.  100% LTCG can be claimed by you only, in lieu of the proposed new property purchase WITHIN two years, in your name.

Keep Smiling .... Hemant Agarwal

 

Hemant Agarwal
Advocate, Mumbai
2403 Answers
14 Consultations

5.0 on 5.0

1.  Yes upon sale of this property, the applicable long term capital gains tax has to be paid.

 

2. You may check with your auditor about this because LTCG exemptions is available only for the house property sold and purchased subsequently  as a new house.

T Kalaiselvan
Advocate, Vellore
56549 Answers
695 Consultations

5.0 on 5.0

Yes, you will incur capital gains tax for inherited property also at the time of selling it.

T Kalaiselvan
Advocate, Vellore
56549 Answers
695 Consultations

5.0 on 5.0

Capital gain tax is applicable only on sale of inherited property. 

Shubham Jhajharia
Advocate, Ahmedabad
19206 Answers
75 Consultations

5.0 on 5.0

capital gains tax is applicable for sale of inherited property 

Ajay Sethi
Advocate, Mumbai
66757 Answers
4037 Consultations

5.0 on 5.0

there is no tax on inheritance,gains are taxed when inheritors sell the property

Mohammed Mujeeb
Advocate, Hyderabad
10125 Answers
3 Consultations

4.5 on 5.0

Yes , whenever you sell such property capital gain tax is liable to you

Cost of property is calculated on basis of inflation index

Dimple Jain
Advocate, Jodhpur
222 Answers

Not rated

Ask a Lawyer

Get legal answers from top-rated lawyers in 1 hour. It's quick, easy, and anonymous!
  Ask a lawyer