Rural agriculture land if sold no capital gain if urban land is sold for this see defination of rural agricultural land as per income tax then chargeable to tax but if after sale the proceeds are invested in purchase of some other agricultural land then whole capital gain is exempt there are tds provisions also refer that also
Urban agricultural land is a capital asset and any gain arising from the sale will be treated as Capital Gain. Whether the Capital gain is long term/short term will depend upon the period of holding of asset concerned.
If the period of holding is more than 2 years then the capital gain arising will be termed as long term capital gain. If the holding period is shorter, then the gain arising is termed as short term capital gain.
Long term capital gain is taxable at 20% whereas short term capital gain is chargeable at slab rate.
You can save tax on sale of urban agriculture land by investing in other agricultural land u/s 54B as per prescribed condition.
Rural agricultural land is not a capital asset and therefore Profit/gain arising from it will not be taxed, it's Exempt from tax.
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