Period of Holding for Property received through Gift

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  1. sanjay2

    sanjay2 New Member

    My father has purchased a residential property in year 1992 . Now he wants to gift it to me this year in April 2015 . If I sell this house witin 4-5 months , can I save on Capital gain tax by investing in capital gain Bonds ? If not what will be tax liability on me ? Please suggest me the better way of tax planning in this situation.
     
  2. rudrabose

    rudrabose Active Member

    The period for which the property was held by your father would also be considered in computing the period of holding.

    As the property has been held for more than 3 years, therefore it is a long term capital gain and exemption can be claimed for amount invested in bonds under section 54EC
     
  3. sanjay2

    sanjay2 New Member

    Thank you Mr Rudrabose for the reply. Actually when I consulted with a senior CA practitioner about this case he said Long Term Capital Gain arises when the property is held for more than 3 years. In case of me I am going to hold the property for lesser period & hence I can not claim exemption if I sell before 3 years. Can you please elaborate this with I Tax Act section ?
     
  4. rudrabose

    rudrabose Active Member

    The period of holding of your father would also be considered. However, when calculating the indexed cost of acquisition - the Cost Inflation Index of the year in which your father purchased it will not be considered and the year in which you got this property would be considered.

    So, this would be considered as Long Term Capital Gains.

    Request your CA to check again.
     
  5. rudrabose

    rudrabose Active Member

    I'm 100% sure on this and I've checked the Income Tax act for the same.
     
  6. sanjay2

    sanjay2 New Member

    Thanks for the quick reply Mr Rudrabose . I will consult again with CA .
     
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