CAPITAL GAIN SHORT TERM OR LONG TERM

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This discussion clarifies how to treat capital gains when selling a property where land and a constructed house are involved. If the sale deed clearly separates the value of the land and the construction, you can calculate capital gains for each component individually. This allows for potentially different tax treatments based on the holding period of the land versus the construction.

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(Querist)
09 July 2022 Assessee bought land on 09.05.2019 for 20 lacs. House constructed & completed on 01.06.2020 for 45 lacs

Sold for 72 lacs on 20.07.2021

How should we treat the capital gain. Land as long term gain & construction as short term or both as short term.

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Dhirajlal Rambhia

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Dhirajlal Rambhia (Expert)
09 July 2022 Whether land value determined separately in the sale deed?
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AMANDEEP

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AMANDEEP (Querist)
16 July 2022 yes sale value is calculated separately for land & construction in sale deed & thereafter sale deed executed on gross amount
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Dhirajlal Rambhia

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Dhirajlal Rambhia (Expert)
16 July 2022 In that case you can calculate gains as said above.
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