A house was purchased in 1999 by my mother in the joint names of my mother and myself. Then, a home loan was acquired in both our names, which was paid off. Though the ownership and loan were in joint names, but it was all paid off by my mother from her own income (all cheque payments were made by my mother). In 2001, we constructed the first floor, but we do not have any records of the payments made to the contractor, as we had paid around Rs.3,00,000=00 in cash in different installments.
Now in 2009, we want to sell this property. The long term capital gain arising, as i understand is supposed to be divided proportionately. My queries are;
1) While cost indexing for home improvement, how can i prove that I had built the first floor in 2001 and that i have incurred an expenditure of Rs.3 lacs then?
2) As I have not contributed financially towards this house, how can it be possible to show that LTCG and the tax arising out of it, can be borne by my mother?
3) The LTCG arising out of sale of this house (after indexing) comes to Rs.5 lacs. What is the amount of LTCG tax which I have to pay? And, what are the measures for me to avoid paying this LTCG tax?
CAclubindia
