Latest Expert Exchange Queries
sitemapHome | Registration | Job Portal for CA's | Expert Exchange | Currency Converter | Post Matrimonial Ads | Post Property Ads
 
 
News shortcuts: From the Courts | News Headlines | VAT (Value Added Tax) | Service Tax | Sales Tax | Placements & Empanelment | Various Acts & Rules | Latest Circulars | New Forms | Forex | Auditing | Direct Tax | Customs and Excise | ICAI | Corporate Law | Markets | Students | General | Indirect Tax | Mergers and Acquisitions | Continuing Prof. Edu. | Budget Extravaganza | Transfer Pricing
 
 
 
 
Popular Search: cpt :: TAX RATES - GOODS TAXABLE @ 4% :: due date for vat payment :: articles on VAT and GST in India :: empanelment :: ACCOUNTING STANDARDS :: ICAI offer Get Windows 7,Office 2010 in Rs.799 Taxes :: VAT RATES :: TDS :: Central Excise rule to resale the machines to a new company :: list of goods taxed at 4% :: VAT Audit :: ARTICLES ON INPUT TAX CREDIT IN VAT :: ACCOUNTING STANDARD :: form 3cd
 
 
« General »
 Aadhaar is must for income tax returns if you have one; Here's how you can file it online
 Will it be a tax haven above the law?
 Your mutual fund investment tax efficient? Here are 3 steps to ensure utmost efficiency for your portfolio
 Finally a goods and services tax. But what lies ahead?
 Tax May Rise On Outbound M&As, Indian Mncs’ Investments
 Filing income tax return? Do remember to claim benefits on your reimbursements
 Banks will have a hard slog ahead to get GST-ready
 Clarification regarding applicability of Section 16 (1)(a) of the Companies Act. 2013 with reference to cases under corresponding provisions of Companies Act. 1956
 Introduce indemnity clauses with suppliers on tax compliance: Expert
 While filing tax in India, NRIs do not have to report overseas assets
  Clarification regarding applicability of Section 16 (1)(a) of the Companies Act. 2013 with reference to cases under corresponding provisions of Companies Act. 1956 -reg.

Tax on capital gains from selling a house depends on period of holding
April, 08th 2014

While each one of us wants to invest in real estate, one needs to be conscious of the tax implications. Tax on capital gains from selling a house depends on the period of holding. If a property is sold before three years of acquisition, the gains will qualify as short-term capital gains taxable like any other income of the assessee.

However, if the property is sold after three years of acquisition, the capital gains, known as long-term gains, are taxable at 20%. In addition to that, the assessee can also avail the benefit of an inflated cost of acquisition.

Additionally, the Income Tax Act provides for exemption from taxation of capital gains if the assessee invests them in a residential house within two years from the sale or constructs another house within three years from sale. However, if the newly acquired house is sold within three years from acquisition, the exemption claimed earlier becomes taxable.

The date of acquisition is of immense importance to determine the nature of the capital asset as well as to claim the exemption. However, in case of self-financed builder flats, the concept of date of acquisition has been quite litigative. Various questions arise in the minds of the intended buyer.

First, does an assessee acquire an asset by booking a flat? Capital asset has been defined to mean property of any kind. Hence, a right to obtain conveyance of an immovable property can be construed as a “property”. Accordingly, if the booking agreement and allotment terms of the builder give a right to obtain conveyance on the flat, that itself will be “an asset” under the Income Tax Act.

Second, whether the gain on transfer of such rights in the flat or on transfer of the flats after talking possession thereof is short term or long term? The deciding factor is the date of acquisition. Indian tax authorities are giving priority to the facts of the case. It has been held in various rulings that the crucial date is the date of allotment of the residential flat and the payment of instalment is merely a follow-up action. Hence, the date of issue of an allotment letter can be construed as the date on which the assessee has obtained the conveyance on the flat.

Lastly, in respect of the exemption claimed under Section 54/54F, where the builder delays the construction of the flats beyond three years, whether the

 
 
Home | About Us | Terms and Conditions | Contact Us
Copyright 2017 CAinINDIA All Right Reserved.
Designed and Developed by Binarysoft Technologies Pvt. Ltd.
Wholesale Silver Jewelry

Transfer Pricing | International Taxation | Business Consulting | Corporate Compliance and Consulting | Assurance and Risk Advisory | Indirect Taxes | Direct Taxes | Transaction Advisory | Regular Compliance and Reporting | Tax Assessments | International Taxation Advisory | Capital Structuring | Withholding tax advisory | Expatriate Tax Reporting | Litigation | Badges | Club Badges | Seals | Military Insignias | Emblems | Family Crest | Software Development India | Software Development Company | SEO Company | Web Application Development | MLM Software | MLM Solutions