Capital gain tax for jointly purchase of new flat

Share
Share This Thread
  1. SeanD

    SeanD New Member

    DEAR SIR

    My name is Sean.
    We have sold 4 very old residential flats last month.(Long term capital gain tax)
    2 of the flats are on my mothers name and
    the other 2 flats are on my fathers name but he expired long ago so the money of the sale has been made equally split on bases of legal heirs between my mom, me, & my sister.
    Now I'm planning to buy one residential property JOINTLY in the name of myself & my mom. (Mom's name first & my second or vice versa) Is it possible for both me and my mom to get long term capital gain tax exemption under sec 54? If not, please suggest how do we both get this exemption under sec 54.

    Thank you!
     
  2. ZED

    ZED Well-Known Member

    Why forgetting sister? Even she is liable to capital gain Tax.


    Mother has sold 2 Flats which are solely on her name and other 2 flats in which she is co-owner.

    Your sister also has share in the house property (those 2 flats) and she also sold her share in house property, and so did you.

    Capital gain accrued to all three of you. All three of you should claim exemption (if possible). Exemption can be claimed only in respect of one residential house property in India [available to all 3 of you independently.]

    Co-ownership will also do provided the money of the assessee/co-owner is also actually used.

    For claiming exemption, only capital gain amount needs to be invested.
     
  3. SeanD

    SeanD New Member

    Thank you sir for replying

    Sister plans to buy a new residential property solely on her name so her LTCG is sorted out.

    But I and mom jointly plan to invest that money by buying a new residential house (I being the co-owner). Will we get the LTCG exemption or do we also like my sister buy individual residential property solely on our own name without any joint names to get this exemption?
     
  4. ZED

    ZED Well-Known Member

    Exemption can be claimed in joint name also if the actual outflow of money is also of the co-owner.
    You can buy one big and costly house or both you ,and your mother may buy a house individually.
     
  5. SeanD

    SeanD New Member

    ( If Actual outflow of money is also of the co-owner) meaning we both have to equally contribute to the purchase of the flat right?
     
  6. ZED

    ZED Well-Known Member

    Not necessarily equally. The tax to mother is more because she already had 2 flats on her name and then she also had share in 2 other flats.

    Compute the capital gain in each case and then invest in ratio of capital gain.
     
  7. SeanD

    SeanD New Member

    Thank you so much Sir
     
    ZED likes this.
  8. SeanD

    SeanD New Member

    Sir, slight changes

    My sister ask's if she too can jointly purchase a new flat with my mom ( sis name first and mom second) will she still get exemption from LTCG tax since u had earlier said that myself and mom can jointly buy a property ?
     
  9. SeanD

    SeanD New Member

    Basically what I mean is that I'm buying a new flat with mom as co-owner and my sister is buying a new flat with mom as co-owner)
     
  10. ZED

    ZED Well-Known Member

    Yes, she can.
    Kindly note the following;
    1. The capital gain should actually be used/invested by each assessee.
    2. Each assessee is entitled to buy only 1 residential house in India (whether Individually or in co-ownership).Even the co-ownership of an assessee should be in only a single house. It should not be done that an assessee get co-ownership in 2 house for eg, for your mother, she can not invest once with you and again with your sister.
    3. If the money is not invested within the due date of filing the return the amount of capital gain should be deposited in Capital Gain account scheme.
     
Draft saved Draft deleted
Loading...
Similar Threads Forum Date
Capital gain on property Income Tax Mar 21, 2018
Capital Gain tax & income tax - joint development of land Income Tax Mar 18, 2018
Capital tax gain Income Tax Mar 11, 2018
Capital Gain Tax. Income Tax Feb 19, 2018
Capital Gain on Residential Property- Co-Owner Income Tax Feb 14, 2018