I have a commercial property in Gurgaon which was purchsed by me at the rate of 4400 per square feet in the month of January 2010. The registry of the property was done in the month of October 2010.
Now I want to sell the same. The current circle rate has increased to 6000 per square feet.
I would like to know whether the gain will be subjected to any TAX LIABILITY?
If yes, than how much,
I would like to have my residential apartment wherein I would like to invest the amount recd from this deal.
I need to clarify whether the reinvesting option can reduce my Tax Liability or not.
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Short Term Capital Gain
Replies (1)
The period of holding the asset is less than 3years, thus it becomes a short term capital asset.. profit from the sale of this asset will be treated as short term capital gain.
You have a profit of Rs.1600 per sq.ft you can deduct any expenses on transfer only.
If you have nearly 1000sq.ft of land then your STCG will be Rs.16 Lakhs. you have to pay tax at this income in normal slab.
No deduction will be allowed for utilising the sale proceed in construction of flat, as that option is availble only for Long term capital gain..
The Best option is to built a flat in the same land by getting a home loan, as this will increase the value of property and decreases present day tax liability.
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