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Capital Gains Tax on Property Sale

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Barkha

None

259 Points Posted on 12 February 2023

Bought a property in 2012 for 18 lakhs,

Now, selling it for 32 lakhs on Agreement for Sale, where buyer will be paying the amount over a period of 5 years and final formalities of registration etc. will be done after 5 years (2028).

Question: Which year is the capital gains tax applicable?

1. Over all the 5 years, depending on the amount received each year?

2. In 2028, when the final formalities are done?

Replies (9)

Quick Summary

This discussion clarifies when Capital Gains Tax (CGT) applies to a property sale where payment is received over five years, with final registration in 2028. The consensus is that CGT is applicable in the year of the final sale deed and registration (2028), not annually based on payments received. Handing over keys does not trigger the tax liability; it's the actual transfer and registration of the property that counts.

Dhirajlal Rambhia

SEO Sai Gr. Hosp.

212441 Points Posted on 12 February 2023

When the possession of the property be given?

sabyasachi mukherjee

Profession Business

28246 Points Posted on 12 February 2023

Transfer of capital asset.
then capital gain tax is applicable.

Share knowledge

Job

47 Points Posted on 13 February 2023

CG applicable only in the year of final registration I.e 2028

Barkha

None

259 Points Posted on 13 February 2023

Dhirajlal Sir, Full transfer and registration to be done in 2028, but keys to be handed right away.

Mahesh Shah

2478 Points Posted on 13 February 2023

Tax liability rises when there is SALE DEED and not AGT for sale ( liability arises when actual property is trf and redg) irrespective of payments date