Income tax on sale of undeclared house property

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ravi shankar (Querist)
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08 April 2019 I am a regular income tax payer but my wife is not. She has a house constructed in her name about 8 years ago which is lying vacant. Only once to claim refund TDS on interest income, she filed ITR showing some notional rent from it otherwise the house property is undeclared. It was constructed with some savings and assistance from parents etc. There is no record of the money spent for construction or its value today. What will be tax implications if the house is sold and how can it best handled?

CA PARAS BAFNA

CA PARAS BAFNA (Expert)
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09 April 2019 What is meant by some notional rent income?
Have you ever furnished her Balance Sheet data ? I presume that the same were not required to be given.
If it has been declared as the income of the property under question, you can sell the property and after indexation of the cost incurred , you should pay capital gains tax , or purchase a new property in her name.

ravi shankar

ravi shankar (Querist)
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09 April 2019 Thank you Sir. No balance sheet was required to be filed nor wait filed. Notional rent was shown in ITR filed by her only once in the last 8 years since house was constructed to claim refund of TDS of Rs 1800 or so on FD interest. Now will she be required to give details of sources of income etc.get house evaluated as its actual cost is not known being constructed over period of time and details of expenditure on construction not maintained. Sorry for inconvenience Sir

CA PARAS BAFNA

CA PARAS BAFNA (Expert)
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10 April 2019 You must be knowing the sources and the amount spent. Take the year wise expenditure made say in FY 2008-09 -3,50,000 2009-10 230000 . The first important thing is to disclose the sales consideration in the ITR, which is the current event. Take lesser pain about the past and source. The question as regards cost may even not be raised if the same appeared to be realistic.

ravi shankar

ravi shankar (Querist)
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10 April 2019 Thank you very much Sir. I am now prepared to go ahead. Regards

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