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Acquired property through gift,

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umesh

accountant

151 Points Posted on 28 June 2024

acquired property through gift in 2022,now sold the property for a value of 4 cr, will it attract capital gain.. please explain..

Replies (4)

Quick Summary

If you sold a property that you acquired as a gift in 2022 for £4 crore, you will likely face Capital Gains Tax. The tax is calculated based on the difference between the sale price and your 'basis' (which for gifted property can be complex and often relates to the donor's original cost). The length of time you held the property also affects the tax rate, with longer holding periods typically resulting in lower rates.

Rama chary Rachakonda

Master in Accounts & high court Advocate

9620 Points Posted on 28 June 2024

When calculating capital gains on property, follow these steps:

Determine your basis: This is generally the purchase price plus any commissions or fees paid when acquiring the property.
Calculate the realized amount: Subtract your basis (what you paid) from the sale price (how much you sold the property for) to determine the difference.
Understand the holding period: Capital gains are taxed differently based on how long you held the asset. If you held the property for less than a year, it’s considered short-term; if more than a year, it’s long-term.
Review the tax rates: Long-term capital gains tax rates can range from 0% to 20% depending on your income and filing status¹. State and local taxes may also apply.

Remember that specific circumstances and exemptions can impact your capital gains tax liability.