Query on longterm capital gain

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Hi

My father-in-law has disposed his independent house for Rs 40 lacs in chennai.
They were living in this place from 1972.During this time 3 time it was rebuilt.

Lately it was rebuilt in 2004 for cost of 13 lacs.This locality was regularised by govt in 2001.
He is senior citizen and does not have any income.
How the tax outgoing is calculated?

After disposing the property the amt was distributed to his sons.

Thanks

Replies (6)

Hi , Taxation will be done as follows : 

                     Sale Value

Less : Indexed cost of acquisition

Less : Indexed cost of improvement

Less : Cost of transfer 

=    Long term capital gain 

Note : taxability @ 20% will arise in the hands of father in law .

Note: Son receiving the amount will not be subject to taxation in any way , irrespective of amount , as                they are covered under the definition of relative under section 56(2)(vii).

Note : It will be better to gift the property to the sons and the sons will later on transfer it so avoiding the capital gain and later when sons will sell the property they wil be subject to capital gain . 

Note : Also , improvement cost incurred after 1980 will be taken into consideration . 

agreee with shashank

AGREE WITH AFORESAID................................

LONG TERM CAPITAL GAIN ON SALE OF RESIDENTIAL APARTMENT - REFERENCE DATE Pls clarify if someone books an apartment of Unitech in Gurgaon and after construction the conveyance deed done in Dec.2008 but as he dies immediately after registry, his daughter took possession of aptt in July 2009 as per possession letter of builder. Tell me 36 month will be taken from which date to be eligible for availing LONG TERM CAPITAL GAIN on sale of this apartment. Can it be sold in January 2012 i.e 36 months after Registry date or She has to wait till July 2012 i.e 36 months from Date of possession letter from builder to him. An early views will be highly appreciated.

agree with shashank.......

shashank is correct

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