Dear Sir,
To answer the question appropriately, please let us know date of sale of old property and date of purchase of new property.
Yes, if your wife did not funded the old property, she need not to pay any tax.
Property selling in joint ownership nature and buying again
I had a property in joint name with my wife as owners and i have sold the property with some capital gains. The whole money from selling was credited to my account as my wife's name was there only for namesake. Now i am buying another property in my name alone investing the money i received from selling the property with some additional money as the cost of new property is higher than that. For the first property as my wife was a owner, though she did not take any money, does she need to pay any tax or show this transaction as part of her tax return? Secondly, as i am buying the new property in my name alone and investing the whole amount from sale from last property in it, if i show the whole amount in my IT return, will it be any problem from personal income tax angle?
Asked 8 years ago in Capital Gains Tax
Sir if you are purchasing property in your name by selling the property which was in joint name then also you can get capital gains tax benefit U/s. 54. There will not be any problem if your wife does not declare the same and you only will declare in your IT Returns
The date of selling old property was 30-Nov-16 and date of purchase of new property will be 23-March-17. My wife was only mentioned as joint owner in the old property paper, she did not fund it. Does she need to show any thing as part of her IT return for current financial year as i am showing it in my return anyway seeking tax benefits U/s 54 as i am reinvesting the whole capital gain in only one residential property for us.
Asked 8 years ago
No there is no need. If the department ask for the details then we can write a letter stating that the whole amount was mentioned in the husbands Income tax Returns
Dear Sir,
Yes, you can take exemption and your wife need to pay tax.
Please feel free to call/ revert in case of any doubts
Thanks and Regards
Abhishek Dugar
CA CS B.Com
Dear Sir,
Ideally you need to show all the income divided equally to claim the income as well as benefit of exemption us/ 54
Hello Sir,
Your wife need not show it in her returns but it will be preferable if you maintain all the payment records made by you in order to purchase the old property in case you receive a scrutiny notice which is very much possible whenever a person take the benefit of Section 54.
Trust this clarifies your query.
Feel free to call / get back in case of further clarifications.
Thanking You.
Regards,
Rohit R Sharma
BCOM, ACA, LLB-GEN, CERT. FAFP
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