Capital Gain Exemption if purchased on Married Daughter's name

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  1. skk

    skk New Member

    I purchased a residential plot in Dec 2003 for Rs. 2.69 Lakh and sold it in Jan 2015 for Rs.25 Lakh. I am already having one property in my name and another in joint names with siblings. I am retired person and no income from any other source except interest and pension. My query is :
    1.What would be Capital gain Tax on this amount ?
    2.When it is to be deposited ?
    3.Whether I can buy a new house/flat in my name ? if not, then
    4.Whether I can buy a flat in the name of my wife or married daughter who does not own property ? If yes, then how to do that ?
    5.What would be implication on my Tax (personal IT and LTCG) ?
    6.If I do not intend to purchase the house then what is implication ?
    7.If I am not eligible to get benefit of LTGC benefit because of already having property, then what is the option (i) How to pay Tax (ii) How to save Tax ?
    8. Any other suggestion.
    Kindly help.
  2. 1.Your Capital gain tax on the sale of property (based on the information provided without cosidering selling exp. There might be expenses on sale which you have not mentioned) would be INR 3,92,443.
    2. The Capital gain tax should be deposited with the advance tax liability (i.e. by 15th March, 2015)
    3. You can always buy a flat/house in your name but the tax benefit will not be available as you are already having two residential property.
    4. You can buy a flat in the name of your spouse/married daughter but again the tax benefit will not be available to you. Besides this, you have to show the purchased flat as you have gifted to your spouse or married daughter.
    5. The tax implication on your IT Return will be as stated below:
    Your tax liability for the A.Y 2015-16 will be increased by the LTCG.
    6. If you do not want to purchase the house then you can invest the money (For the investment option for tax saving your tax you may consult the professional)
    7. you can save tax by investing it into the eligible option or pay tax as explained in point (1).
    To save tax or benefit of exemption/deduction you should have consulted the professional before selling the flat.
    Pls. Note the suggestion is based on the information provided and totally my view. It is always better to cosult a tax professional in your case.
    skk and gaurav_kumar like this.
  3. gaurav_kumar

    gaurav_kumar Well-Known Member

    Dear @skk

    I agree with the all the viewpoints as mentioned by Narendra.

    If you had sold a Residential House instead of Residential Plot - you could have claimed capital gains exemption under Section 54 irrespective of the no. of houses owned by you.

    However, as you have sold a Residential Plot, Section 54F would be applicable and in case of Section 54F - capital gains exemption can be claimed only if you dont own more than 1 house property.
  4. skk

    skk New Member

    Dear Sir,
    Thanks a lot for useful info.
    1.Further, is it necessary to deposit advance tax ? If yes, what is procedure ?
    Now. exact date of filing papers to Registrar office was in Dec 2003 and got it signed documents in Jan 2014 and sold in Jan 2015. Total purchase value comes to tune of Rs. 241899/- (inclusive of stamp papers + bank interest for one year).

    2.Whether any sum paid towards Chowkidari of Plot for 60 months AND selling commission @2% can be deducted from selling price ? if yes, then .. is there any limit of amount and whether receipt is required ? Generally in such cases receipts are not issued. Kindly Guide.
    3. How the taxable amount (LTCG) is determined ? Any ready Reck is available ?
    4. If I purchase a flat (part or full payment) in the name of my married daughter then whether it will attract any Gift Tax 0r any Tax on me or daughter ?

    Kindly help and guide. Regards.
  5. gaurav_kumar

    gaurav_kumar Well-Known Member

    1. Yes, you are required to pay Advance Tax. Any delay in payment of Advance Tax beyond the due date will lead to Interest being levied @ 1% per month. For all about Advance Tax, kindly refer:
    2. All expenses paid at the time of sale like Commission, Brokerage etc are allowed to be deducted provided that you have a receipt for the same.
    3. For computation of the taxable amount, kindly refer this link -
    4. Any gift given to daughter whether married or unmarried is tax free in the hands of the receiver and No Tax is required to be paid in such cases.
  6. skk

    skk New Member

    Thank you Sir,

    Considering all facts and circumstances, if I consider to deposit the Total Capital Gain in specified Savings BONDs then there will be no TAX. Kindly confirm my understanding. Thanks. Regards.
  7. gaurav_kumar

    gaurav_kumar Well-Known Member


    You can invest the amount in specified bonds of NHAI & REC and claim exemption under Section 54EC. You can claim capital gains exemption for the total amount and no tax would be levied in this case.

    Moreover if you want to gift it to your daughter, you can mention your name as the 1st holder and your daughter's name as the 2nd holder. Exemption would be allowed to you in such a case as well and your daughter will also become the rightful owner of the bonds.
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