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ENQUIRY ABOUT TAX LIABILITY

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vinod sharma

self employed

41 Points Posted on 23 May 2023

we brothers jointly purchased a residencial flat In DEC.2022 in which i paid my share amount Rs 606000.after that we brothers sold our ancestral property in Feb 2023 (which was purchased in 1955) and i received my share Rs132500 which is lesser than share of flat purchase value.

pls guide me whether long term capital gain liability will APPLY or NOT.Purchases was made before sale in same FY 2022-23

thanking you

Replies (7)

Quick Summary

This discussion explores potential tax liabilities arising from the sale of an ancestral property. The main question is whether long-term capital gains tax applies, especially after purchasing a new residential flat in the same financial year. The consensus suggests that while a capital gain may exist, it's likely to be exempt under Section 54 of the Income Tax Act if the funds are reinvested in a new property.

Dhirajlal Rambhia

SEO Sai Gr. Hosp.

121407 Points Posted on 23 May 2023

There would be long term capital gain over sell of your ancestral property share, but it would be exempted under sec. 54 of IT act, as investment in new HP.

In short, there would not be any long-term capital gains TAX liability.

sabyasachi mukherjee

Profession

19974 Points Posted on 23 May 2023

What's the capital gain on selling ancestral property. Cost of accquisition and capital gain.

shivani

student

79 Points Posted on 23 May 2023

You need to take indexation cost of aquisition. as the ancestral property is purchased before 2001 you need to take FMV as on 01/04/2001 to calculate indexation cost of aquisition.(ICOA)
deduct this ICOA and cost of improvements /indexation cost of improvements, if any from the fair value of consideration you received to get long term capital gain.