Capital asset to stock in trade
This query is : Open
01 August 2011
There is a land on the name of 4 people.
Now they want to gift the land to people who are their relatives u/s 56(2)(vii). So no tax will be levied on the same. A proper registry of the gift will also be done by paying stamp duty.
Now the people who have got the gift want to construct flats on the same and then sell them.
They are receiving the gift as a capital asset.
So implications if:
1. They show the same as capital assets and flats constructed as cost of improvement.?
2. They convert the same into stock for business and claim construction expenses.?
3. Any other way you may suggest.?
Now they want to gift the land to people who are their relatives u/s 56(2)(vii). So no tax will be levied on the same. A proper registry of the gift will also be done by paying stamp duty.
Now the people who have got the gift want to construct flats on the same and then sell them.
They are receiving the gift as a capital asset.
So implications if:
1. They show the same as capital assets and flats constructed as cost of improvement.?
2. They convert the same into stock for business and claim construction expenses.?
3. Any other way you may suggest.?
01 August 2011
3. Any other way you may suggest?
In case the land is a long-long term capital asset, to get the full benefit of indexation, the Capital Asset should be converted in stock in trade by the 4 persons who are the original holder.
In case the land is a long-long term capital asset, to get the full benefit of indexation, the Capital Asset should be converted in stock in trade by the 4 persons who are the original holder.
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- House Property Reporting in ITR
- Internship/Academic shown in Salary Pay Slip of a Doctor
- TDS Claim year
- Rent lease agreement
- Refund of 20%pre-deposit paid for stay application
- TDS Challan Code
- Nomination of Bank for refund in itr 2
- Relief u/s Section 89
- REGARDING SECTION 44AE
- GST Rate applicable for 0% Food Items sold by an Industrial Caterer
- CG after sale of flat
- E Commerce GSTR1 & 3B how to file
- GST Cancellation without jurisdiction
- Legal Opinion on Registrar's Refusal to Investigate a Society for Non-Renewal and Non-Compliance
- GST Refund_RFD-01
- Form10BD was uploaded successfully without any Error but after 24 hours, Form10BE are not available
- Annexure B utility for GST Refund
- Tax amount diff in Gstr1 and 3B in tax compare reports
- Tds on GST in connection with sale to public company
- Restoration of certificate of practice
Trending Online Classes
-
DT & Audit (Exam Oriented Fastrack Batch) - For May 26 Exams and onwards Full English
CA Bhanwar Borana & CA Shubham Keswani
CAclubindia
