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Capital gains tax on house property

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Querist : Anonymous

Querist : Anonymous (Querist)

30 August 2012 A lady aged 80 years has one self-occupied apartment and a second apartment which she had purchased in April 1992 for Rs. 10 Lakhs and which she has rented out. As she is very old and can die anytime, she decides to sell off in June 2012 the second apartment for Rs. 80 Lakhs and deposits the proceeds in her savings account. Subsequently she decides to give the sales proceeds to her son to enable him to buy his own apartment? The son considers this amount as gift from mother and buys his apartment? Please advise what are tax provisions with respect to Capital Gains Tax and Gift Tax?

CA Siddhartha Bhardwaj

CA Siddhartha Bhardwaj (Expert)
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31 August 2012 1. Capital gain shall arise on the sale of the apartment. On such gain tax shall be payable by the lady.

2. Gift tax has been abolished. There is no tax on gifts.

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