Long Term Capital Gain Tax Property Jointly Owned

Save Share

This query is : Resolved

Quick Summary

This discussion clarifies the long-term capital gains tax implications for a jointly owned property sold after several years. Even though the individual capital gain for each owner might be below a certain threshold, tax can still be applicable depending on their personal taxable income. One owner, with a higher taxable income, will likely need to pay capital gains tax on their share, while the other owner, with minimal income, may be exempt.

NiJPo

NiJPo (Querist)
Follow

20 February 2021 Hi Friends,

Party A and Party B purchased a residential flat in July 2013 at 17.0 Lakh. Now, the same flat is sold for 25.0 Lakh in January 2021. Considering CII value of 220 in 2013-14 and 301 for 2020-21, the indexed Long Term Capital Gain for each Party is around 70,000. Since the gain is less than 1 Lakh for each, Will there be any Long Term Capital Gain Tax?

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
Follow

21 February 2021 Yes, long-term capital gains tax applicable if the parties have taxable income.
One lac exemption available only on sale of shares.

NiJPo

NiJPo (Querist)
Follow

21 February 2021 Party A is a salaried employee having taxable income. While Party B is a senior citizen house wife (filing income tax but income is quite less than taxable income)

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
Follow

21 February 2021 Party A has to pay 20% tax on his portion of capital gains. Party B no tax payable if income below taxable limit after adding capital gains.

You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now