27 June 2014
Respected Sir, My father recently about to sell a land(not agricultural) property of 10 decimal, which inherited from my grandfather.The record of the land was made in 1970. Now the sell price for the land is 10 lakh rupees for 10 decimal(1 lakh each decimal). the land situated near urban place, 5km away from main town. Sir,here I've a question that, if the land sold for the mentioned price whether my father has to pay tax or not. If yes, then how it'll be calculated, I mean what percentage will be tax etc...
27 June 2014
yes shall be taxable as long term capital gains. value of land as on 1 April 1981 indexed till the year of sale shall be indexed cost...reduce this indexed cost from sale proceeds to arrive at the capital gains. you have the option of investing the whole of the consideration received under section 54F to buy a house property to avoid the capital gains. Otherwise pay 20% capital gains tax.
27 June 2014
you have to take value on 1.4.1981 as per the income tax act it required. and then you sale price-1.4.1981 price X index of 1981 / sell year index = gain you can save this in section 54F for investing in residential property or you have tot pay tax @ 20%.
CAclubindia
