Long term capital gain taxation

Tax queries 601 views 3 replies

Sonam

Final CA Student

53 Points Joined November 2010

Hi, I have a querry regarding taxability of LTCG in case of deceased assessee. The assessee was a super senior citizen and having LTCG on sale of property which is taxable @ 20% subject to basic exemption limit and other sources income. Till date, no investements U/s 54 has been made to claim exemption against LTCG. Can investment in the name of legal hier be made as on date ? Since as per Sec 54EC investments should be made within 6 months from date of sale and 6 months has not elapsed.

Awaiting expert opinion on the same.

Thankyou in advance.

Replies (3)

Z

Tax Consultation (US and India)

2970 Points Joined September 2011

In this case there is no requirement to make any investment , since this is the case of devolution of the estate

Circular : No. 743, dated 6-5-1996.

" A question has been raised regarding the taxability of the unutilised deposit amount in the case of an individual who dies before the expiry of the stipulated period.

The matter has been considered by the Board and it is clarified that in such cases the said amount cannot be taxed in the hands of the deceased. This amount is not taxable in the hands of legal heirs also as the unutilised portion of the deposit does not partake the character of income in their hands but is only a part of the estate devolving upon them."

Sonam

Final CA Student

53 Points Joined November 2010

As per what you mentioned that there is no requirement for investment, what will be the tax calculation for LTCG ? Sale Proceeds Less Indexed COA = Taxable LTCG @ 20% subject to unexhausted basic exemption limit? Will this be the tax mplications ?

Thanks