Sale of redeveloped apartment in Mumbai

1. Capital Gains Tax:

   • Since the property was originally acquired in 1976 and considering the redevelopment agreements, the sale will be treated as a long-term capital gain.
   • Long-term capital gains (LTCG) are taxed at 20% with indexation benefits.

2. Tax Deducted at Source (TDS):

   • 
     For You (NRI):

     • TDS is 20.8% (including surcharge and cess) on the sale proceeds.

   • 
     For Your Brother (Resident Indian):

     • TDS is 1% on the sale proceeds.

3. Additional Tax Considerations:

   • If the TDS exceeds the actual tax liability, you can apply for a refund at the end of the financial year.
   • Alternatively, you can apply for a certificate for lower TDS before executing the sale agreement.

4. Exemptions:

   • Consider reinvesting the capital gains in specified bonds (Section 54EC) or another residential property (Section 54) to avail of tax exemptions.

For detailed, personalized advice, consider a phone consultancy.

Hope you find the information helpful. You are free to contact me for further discussion.If you could spare two minutes of your time to write a review, It would be really grateful and very happy to read it.

Thank you.

Shubham Goyal

- As the property is inherited by you and your brother, share of each in the property would be 50%

- It would be a long term capital gain

- In case of NRI, tax rate would be 23.92% on the sale consideration amount. You can take assistance of professional for filing of lower TDS deduction certificate. The entire process is online

- In case of resident, TDS rate would be 1% of the sale consideration amount. As the total income exceeds Rs. 50 lacs, he needs to disclose assets and liabilities details under Schedule AL

- Sale consideration amount can not be lower than the stamp duty value

- Expenses incurred wholly and exclusively for the purpose of transfer are deductible

- As the CII for F.Y. 2024-25 has not yet been notified, assuming it to be 365. Basis on that, LTCG would be Rs.3.24 cr approx.

- Is there any loan availed for the property to be sold? 

- Is there any cost of improvement incurred on the property?

- You can reinvest the capital gain amount in the residential property or in capital gain bonds upto Rs. 50 lacs

- For repatriation of proceeds you need to file Form 15CB and 15CA

- TDS credit will be set off against the total tax liability

For detailed discussion you may opt for phone consultation