• Tax on sale of property

My parents had sold a property 2 years back. They received 15 lac from its sale. It has been 2 years now but they still have not invested that amount anywhere. As per my understanding, it should have been invested in 2 years' time. One month to go for that. Please suggest ways it can be invested aside from property purchase so as to avoid paying tax.
Asked 4 years ago in Income Tax

Hi,

 

You can still save the taxes by investing the amount in under construction property.

 

However,the construction must be completed within 3 years of transfer of said assets.

 

I'm assuming that the amount had been deposited in CGAS within the timeframe..


 

It is advisable to take a phone consultation for complete understanding. 

Payal Chhajed
CA, Mumbai
5188 Answers
288 Consultations

5.0 on 5.0

Since 2 years have passed there is no other option left but to construct a house within next 1 year as the time limit to purchase bonds was also 6 months from the date of sale.

First of all calculate if there is any tax payable also as the sale amount is less.

 

Hope you find the information helpful if you do please rate it 5 and provide your valuable feedback for my improvement.

Thank you.

Naman Maloo
CA, Jaipur
4265 Answers
96 Consultations

5.0 on 5.0

Hello,

 

Since 2 years have elapsed, the only option left is to construct a house property within the next 1 year. The time period for investment in specified bonds has also elapsed.

 

First, kindly check if there is any capital gain taxable on such property. Calculate the Capital Gain.

I hope this answer satisfies your requirement.

 

Regards,

CA Hunny Badlani

Hunny Badlani
CA, Madhya Pradesh
2608 Answers
16 Consultations

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Hi,

- What is the amount of capital gain?. As the amount of sale is Rs.15 lacs, assuming capital gain would be less.

Vivek Kumar Arora
CA, Delhi
4825 Answers
1030 Consultations

5.0 on 5.0

Dear Sir,

 

The time period for deposit the amount in capital gain account to get exemption has already lapsed.

 

Now, you are not eligible to get any exemption.

 

 

Payal Chhajed
CA, Mumbai
5188 Answers
288 Consultations

5.0 on 5.0

If you hadn't invested the amount while filing the return of income then how did you claim exemption?

Now you can't invest in capital gain account for amount received in october 2017.

 

Naman Maloo
CA, Jaipur
4265 Answers
96 Consultations

5.0 on 5.0

- Try to purchase the property in 3 weeks.

Vivek Kumar Arora
CA, Delhi
4825 Answers
1030 Consultations

5.0 on 5.0

Hi

 

If the amount was not deposited in CGDS account before due date of return filing of the year of sale, no exemption shall be provided.

 

 

Lakshita Bhandari
CA, Mumbai
5687 Answers
909 Consultations

5.0 on 5.0

However, looking at the amount, there are chances that such transaction would go unnoticeable.

You should make the investment within one month or construct a new house property within 1 year to avoid any future complications to greater extent.

Lakshita Bhandari
CA, Mumbai
5687 Answers
909 Consultations

5.0 on 5.0

Timelimit for you to deposit the amount in Capital Gain account was the due date of the return for F.Y. 2017-18 (that was 31st Aug 2018) which has already lapsed.  

Kindly check the taxable capital gain amount first.

Hunny Badlani
CA, Madhya Pradesh
2608 Answers
16 Consultations

5.0 on 5.0

The investment in capital gains account scheme is a stop gap arrangement given by government to find or construct a house.  You should have put the money in scheme before filing the return in the year of the year you made capital gains.  If the money is not invested at all or put in scheme, there is no other way to save tax.  This amount should be offered to tax now, ideally in the year you incurred gain. If the time to file belated return has lapsed show the amount in this year return.  Else just keep quiet and wait for any notice and file return with tax. 

Another option is just to pay the necessary tax now to stop the interest metre and penalty.

Jasmina Jain Shah
CA, Greater Mumbai
454 Answers
4 Consultations

5.0 on 5.0

Hello Sir,

 

As the capital gain amount was not deposited in capital gain account scheme on or before the due date of filing of returns of that year, you are not able to claim any exemption.

Karishma Chhajer
CA, Jodhpur
2450 Answers
29 Consultations

5.0 on 5.0

Now, you can not deposit the amount in capital gains account for the amount received in FY 2017-18.

 

The time limit has already lapsed.

Karishma Chhajer
CA, Jodhpur
2450 Answers
29 Consultations

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