I am selling my house property to Mr.A and buying another house from Mr. B.
I am going to take advance from Mr.A for selling my existing house tomorrow. Registration of sale deed will however be during sep 2015 and till then, I will be in possession of this existing house. Mr.A will give me the full sale consideration on Sep 2015 and then I will hand over the possession to him.
After I take the first instalment of my sale consideration tomorrow, I will make the first instalment payment for the new house which I am going to buy. I will make full payment for my new house within a month
The new house is under construction and will be handed over to me during nov 2015.
In this case, when will be my date of transfer for both transactions?
For which AY should I pay capital gains tax for both these transactions?
Which is important for capital gains taxation, Date of registration of sale or date of execution of sale deed or date of possession of property?
And is taking of advance from the buyer of my existing house and giving it on the same day to the builder of my new house create any trouble for me?
Please can you help me out on this at the earliest?
You can also refer me relevant cases for this. I am about to help few senior citizens on this
13 December 2014
Sept 2015, when you will enter into agreement and hand over the possession, shall be the TRANSFER date. Accordingly capital gain shall be computed for the financial year 2015-16. The capital gain exemption for PURCHASE of new house is available provided you buy it ONE year before OR TWO years after....
13 December 2014
Thank You Amol..... Since the property in discussion is under construction, time limit for exemption is 3 years from date of transfer.. Am I correct?
13 December 2014
The real TEST is whether YOU purchase it OR YOU construst it..... 3 years period is for both but with SHIFT in window. For purchase : 1 yr before or 2 yrs after For Construction : 3 yrs after
Pls note, if you are constrcting it, then 3 years after. From your query it appears that property is under construction...and you are going to purchase the same...am i right?
13 December 2014
Actually the property is under construction by a builder. He is promoting lot of flats which are under construction.
My client is planning to buy one of them by selling his home. Once my client books one of them, they will allocate that in his name, fully construct it and hand it over to him. As of now, they have just completed the basic foundation of flats.
CAclubindia
