Capital gain incase of Sale of flat

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This discussion addresses capital gains tax implications when selling a jointly owned property. The client, a second holder, faces a significant long-term capital gain. The query explores whether this entire gain can be attributed to the wife to utilise her substantial carry-forward losses from a previous sale. However, the advice suggests that for joint properties, gains are typically deemed equally shared unless specified otherwise, making it inadvisable to assign the entire gain to one owner.

DIVYESH JAIN

DIVYESH JAIN (Querist)

10 April 2022 Dear Sir,

One of my client is selling a property in which she is the second holder of the property whereas his husband is the first holder of the property as per Sale Agreement.

While arriving at the capital gain calculation there is a Long term capital gain of Rs. 17 lacs in total once they sell it in AY 2023-24.

My question is that can this capital gain be taken in the wife's name instead of dividing it equally with husband as wife has previous carry forward losses of Rs. 25 lacs in her name for selling another property at loss in previous year i.e. AY 2022-23 in which wife was the sole owner.

Please help me in this matter.

Regards,
Divyesh Jain

PARAS CHHAJED

PARAS CHHAJED

(Expert)

10 April 2022 Once it is a joint property and shares of both shall be deemed to be equal unless otherwise specified in the conveyance deeds, it is not advisable to include entire gain in the hands of one owner.

DIVYESH JAIN

DIVYESH JAIN (Querist)

11 April 2022 Thank you Sir for your valuable suggestion.

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