• Dividing house property sale capital gain among joint owners

Hello,

This is query about splitting proportion of capital gain from house property sale.

Myself and my wife bought a house for 30 lakhs in 2011 9 years back (6 lakhs payment+24 lakhs loans)
That time wife was working and earning but contributed small portion (say 10%) in purchase of house.
next year 2012 she left the job.

Now we have sold the house for 60 Lakhs before march 2020 and with considering the indexation capital gain is say 6 lakhs.
It is purchased by joint owners (husband and wife) who paid 30 lakhs each to us 
Buyer husband paid 30L by cheque to me and his wife paid 30L by cheque to my wife.
They also deposited 1% TDS in half half proportion (0.5% which is 30 thousand to my name and 0.5% to my wife's name)

Now how do we split the capital gain to pay tax (did not invest in bonds/Captial gain AC)
Should be split 50%-50% (ownership proportion not mentioned during purchase/any other documents)
OR considering I paid major amount (90%) I should pay 90% of the tax


some more points:
For tax purposes I used the rental income from house and loan interest tax benefits fully to my name 
(showing wife's share of ownership only 1% every year) as she was not working.

All the loan EMIs were paid from our joint account in a bank.

my and wife's 26AS have these 30 lakhs entries now under SFT-012 Purchase or Sale of Immovable Property

As wife is in lower tax bracket this division % will change the taxes
Please suggest about how to split share of capital gains to pay the tax.
Asked 3 years ago in Capital Gains Tax

- As you have mentioned that % of share in property is not mentioned in the deed but actually you contributed 90% and your wife 10% for purchase of the property. As per law % of ownership is 90% and 10%. Capital gain should be divided in such % only but to claim the benefit of home loan you showed the % as 99 % and 1%. To avoid scrutiny further and mismatch, it is advisable to show 100% capital gain your ITR as you have claimed the entire benefit of loan. Benefit of loan claimed will not be considered again in cost of acquisition of the property. I may assist you in filing of ITR. Drop me contact no. at aroravivek1982@gmail

Vivek Kumar Arora
CA, Delhi
4840 Answers
1037 Consultations

5.0 on 5.0

Hi

 

As per my understanding it is better to show complete amount in your ITR . Or we can discuss further please have a phone consultation.

Karishma Chhajer
CA, Jodhpur
2450 Answers
29 Consultations

5.0 on 5.0

Dear Sir,

 

Hope you are doing well !!

 

It is advisable to show the entire capital gain amount in your ITR.

 

We may assist you in entire procedure.

Payal Chhajed
CA, Mumbai
5188 Answers
289 Consultations

5.0 on 5.0

Ask a Chartered Accountant

Get tax answers from top-rated CAs in 1 hour. It's quick, easy, and anonymous!
  Ask a CA