Capital Gain Calculation on Part sale of property

Save Share

This query is : Resolved

Quick Summary

This discussion addresses how to calculate capital gains tax when selling individual flats from a property that was initially purchased as a plot and then developed. Key questions include determining the cost of the original plot for partial sale calculations and whether cash payments for construction are allowable expenses for tax purposes. The conversation also touches upon the importance of sanctioned building plans for property registration and sale.

Shan

Shan (Querist)

31 January 2022 Purchased a property, constructed some flats on that property now selling individually.

Query 1 . How to calculate capital gains on it?
Means what will be the cost of purchase as plot was purchased and now we are selling in part.
Lets say 100 rs property was purchase and now being sold @30*4, some will be sold now some to be sold later on. So how to arrive at capital gain for the purpose of Income tax.
Query 2. Is cost of construction allowed if paid in Cash, runs in several lacs.

Thanks

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)

31 January 2022 What is the mode of sale?
Is it registered as plot or constructed property?

Shan

Shan (Querist)

31 January 2022 It is registered as a built up property, but only part of the property was built earlier now it has several floors and 2 flats on each floor

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)

01 February 2022 Whether the building plan was sanctioned by local authority?

Shan

Shan (Querist)

01 February 2022 I don't think it was sanctioned,

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)

01 February 2022 How can he sell and/or register a sell deed of any constructed property whose plan is not sanctioned?

You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now