My sister getting her share of 15 lakhs from a sale of a property which was bought by her father in law(who is no more now) my sister is a widow now and she is a house wife.is she required to pay tax on capital gain? If yes how to calculate the capital gain and what is the percentage of this tax?
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the sale of property made from 23 July 2024 will attract a tax rate of 12.5% only (without the indexation benefit).
2) Property buyers who have acquired property before July 23, 2024, will have the option to choose between the new rule (12.5% LTCG tax without indexation) and the old rule (20% LTCG tax with indexation) to ensure lower tax liability."
There no CGT on gains on sale, transfer of ancestral property. As the property in coming from FIL, there is no question of application of any CGT.
The capital gains on the sale of inherited property are as follows:
When the property is held for more than 24 months from the date of its acquisition, the gains from the property will be termed as Long-Term Capital Gains. (LTCG) and will be taxed at 20% with indexation. However according to Budget 2024 tax is reduced
When the property is held for less than 24 months from the date of acquisition, the gains from the property will be termed short-term Capital Gains (STCG) and are taxed at the slab rate applicable to the taxpayer.
**It is important to note that the indexation benefit that previously was available on sale of long-term assets, has now been done away with with effect from FY 2024-25. However, the Government has given taxpayers an option to compute taxes on real estate transactions purchased before 23rd July 2024 either at 12.5% without indexation or at 20% with indexation.
Yes, your sister may be required to pay tax on capital gains if the property sold was a long-term asset (held for more than 2 years). To calculate the capital gain, follow these steps:
Determine the Sale Price (SP): This is the amount received from the sale of the property.
Determine the Cost of Acquisition (COA): This is the original cost of the property when it was purchased by her father-in-law, adjusted for inflation (indexed cost of acquisition) if it's a long-term capital asset.
Calculate the Capital Gain:
Capital Gain = Sale Price (SP) - Indexed Cost of Acquisition (COA).
Tax Treatment:
If it's a short-term capital asset (sold within 2 years), it would be taxed at 30%.
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Yes capital gain tax will be applicable. 20.08 percent and it’s exempt your 1.25 lakhs
- Any profit generated out of the sale of the properties /assets falls under the category of capital gains and is taxed under the income head “Capital Gains.
- Since, she has not sold the said property being the owner of the same ,, and she got the said amount as her share in the property , then it will not come under the capital gain.
