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Capital gains on gifted plot


My mother intends to gift an open plot that she purchased 20 years ago to me. After the gift deed is executed if I decide to sell the plot after 6 months, what would be the tax implications.

Pls advise.

Thanks

 
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Chartered Accountant


1) The open plot received by you as Gift from your Mother shall be exempt from tax. But if you sell the land to another party then capital gains shall arise.

 

2) While calculating the Capital gains, the purchase price for you will be price which your mother has paid 20 years ago at the time of purchase. Also the period of holding shall be considered from the year when your mother purchased the plot.

 

3) Then the Indexed cost of acquisition of the plot shall be calculated by using the index of year of purchase and year of sale of plot.

 

4) The difference between the selling price of the plot and the indexed cost of acquisition will be capital gains [Long Term] , which shall be taxable @ 20% plus education cess @ 3%.

 

 

 

Regards,

Devendra Kulkarni

 
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HELLO FRIEND......

 

NOTHING WILL BE TAXABLE ON THE RECIPT OF GIFT(LAND) FROM MOTHER, IN YOUR HAND.

 

ON THE SALE , IT WILL BE TAXABLE IN YOUR HAND.( calculation bellow)

 

SALE CONSIDERATION        XXXXXXX

(-) COST OF ACQUISITION    (XXXXX)

CAPITAL GAIN(TAXABLE)         XXX

 

 

NOTE:- COST OF ACQUISITION WILL BE THE COST, FOR WHICH YOUR MOTHER HAS PURCHASED THE LAND AND PERIOD OF HOLDING WILL BE TAKEN FROM THE OF AQUISITION BY YOUR MOTHER.( FOR INDEXSATION)

 

 

 

SHIKHAR SEHGAL.

 
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AGREED WITH SHIKHAR

 
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Agreed with devendra. In addition agriculture land in rural area is not covered in definition of Capital asset hence no capital gain is applicable in case of sale of agriculture land in rural area .However capital gain tax is applicable if land is situated in urban area.


 

 
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Agreed with Devendra & CA Barkha Mittal........

 
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