capital gain tax on selling of inherited property
joydeep chatterjee
(Querist) 24 December 2010
This query is : Resolved
sir,
after my father's death,me,my mother & brother are the legal heir of my father's house.we want to sell the ground floor of the property.municipality mutation is in our name i.e. me,mother & brother.
i am planning to buy a new flat in my name with the proceedings of the sale.but i will be required to use my mother's & brother's amount of share for purchasing the new flat.My question is how my brother & mother will give me their share of amount for purchasing of new flat?what is the procedure?
what will be the capital gain tax incase of my mother & brother?
Khaleel Ahmed Mohammed
(Expert) 24 December 2010
If your mother and brother want to lend their money to you, you can get it through agreement.
Your another question of Capital gain , your are advised to consult with your local tax consultant.
A V Vishal
(Expert) 24 December 2010
As far as your share of ground floor is concerned it should not attract CG tax on assumption that the cost of the new flat is equal to or greater than the CG computed under the IT Act, however, in case of your mother and brother they will attract capital gain tax and require to pay taxes @ 20% in case the CG is not invested in the modes prescribed under S.54/54EC of the IT Act. Merely by lending their amounts to you for investment wil not absolve them from paying taxes.
Anuj Gupta
(Expert) 25 December 2010
If the CG is not invested in modes prescribed by sec.54/54EC then there may be a tax liability for the mother and brother . I suggest to purchase a joint house property so that the tax payment is minimized.
