Query regarding redevelopment of Property -1

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This discussion clarifies capital gains tax for property redevelopment. If a flat purchased in 1990 was surrendered for redevelopment in January 2022, no capital gains tax is typically due in the 2021-2022 financial year. Capital gains only arise when the redeveloped property is sold, not when it's handed over by the builder.

Dimpy

Dimpy (Querist)
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06 April 2022 Hi

Can anyone help me with the following queries?
1. Flat purchased on 1.5.1990 went into redevelopment in Jan 2022.

Will there be any Capital gain arising in the F.Y 2021-2022 where the flat was surrendered to the builder?

TIA

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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07 April 2022 No capital gains in 2021-22.
Capital gains will not arise if equivalent flat is handed over after development.

Dimpy

Dimpy (Querist)
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07 April 2022 Hello
Thank you for the reply. So in case if the redeveloped flat is handed over in Dec 2024 so capital gain will arise in 2024-25? How will the capital gain calculation done?

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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07 April 2022 Capital gains arises only when we developed flat is sold.

CA Puja Sharma

CA Puja Sharma (Expert)
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07 April 2022 Yes there will be no capital gain in case of redevelopment of this flat.

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