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Advance Recd in FY 2020-21 against property actually sold in FY 2021-22

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Vinod Kapoor

Taxpayer

112 Points Posted on 24 July 2021

Sir,

I have sold a house for a Total Consideration of Rs 8,25,000 and have received an advance of Rs 82,500(50,000 cash on 18.02.2021and 32500 through cheque on 20.02.2021)i.e. in F.Y.2020-21.

But the remaining balance payment of Rs 742,500 has been received through Demand Draft at the time of actual registry on 14.07.202121(i.e. in F.Y.2021-22).

While filling ITR-2 for F.Y.2020-21;whether the advance of Rs 82,500 received in F.Y. 2020-21 is to be reported?

If yes, where in ITR-2 ?

Can this Total Amount of 8,25,000 (82500+742500=825000)be reported together in ITR-2 of F.Y. 2021-22 next year ?

Regards,

Vinod Kapoor

Replies (6)

Quick Summary

This discussion addresses whether an advance payment received in FY 2020-21 for a property sale, with the final payment and registry occurring in FY 2021-22, needs to be reported in the ITR 2 for FY 2020-21. The consensus is that the advance itself is not income and therefore not reportable in the earlier financial year. The full sale consideration should be declared in the financial year the property was actually sold and registered, which is FY 2021-22.