Tax Planning

Tax planning 741 views 3 replies

Vinay Verma

Chareterd Accountant

143 Points Joined January 2008

Hi All ,,,,

I received Rs. 20 Lakhs CASH on sale of land .... I do not maintain any books of accounts ..... What can I do to aoid tax on the same .... and to make the money WHITE....... ????????

I do not want to purchase any property or shares .....

And What if I maintain books of accounts .... How can I bring the amount in books????

Thnks

Replies (3)

SIVASIVA

FCA Future CA

4935 Points Joined March 2010

pay taxes don't avoid taxes

Chinmay

Accounts Professional

356 Points Joined January 2010

I suggest you 2 options:

1. U/s 54: to reinvest those amount in Residential Property;

2. U/s 54EC: to invest those amount in notified bonds (i.e. Rural Electrification Corporation or National Highway Authority of India)

Thanks,

Chinmay Damle

deepak K Gujrati

CA-practice

1077 Points Joined February 2009

First calculate long term capital gain based on year of purchase and cost of construction. Please also see the circle rate i.e. stamp value of property for which stamp has been paid. Because higher of the two i.e. sale proceeds or stamp value will be considered for working out LTCG.

Please also see if any amount has been spent in previous years towards soil filling, leveling or boundary construction. That will also form part of cost.

It is always advisable to pay tax and have white amount. If can invest go for option mentioned by Sri Chinmay.