Tax on the sale of the property
Net
(Querist) 19 May 2013
This query is : Resolved
Sir, My father has sold the property and wants to now decide on whether
1- Divide the money in 5 shares, What percentage of tax will be applicable?
2- Or Buy 5 falts and share it each one of us. what percentage of tax will be applicable/
Your response will be highly appreciatable.
Anirudh
(Expert) 19 May 2013
I hope the property was in the hands of your father for more than three years.
First you have to work out the capital gains arising out of the sale of the property.
In order to go without paying capital gains tax, the entire amount representing the capital gains has to be invested in buying another property. If it was house property, then he can buy another (not five different) house property.
Without buying the property, if the money is distributed, then the capital gain tax cannot be avoided.
prabhakar singh
(Expert) 19 May 2013
Yes!Rightly spoken by Mr.Anirudh!
As the father was the owner tax is payable by him and reinvestment only in his own name within time can save him of paying capital gain not otherwise.
Net
(Querist) 19 May 2013
Thank you all respected sirs,
If the money gets divided among family. after paying capital gain tax. does each member have to pay separate tax for receiving the share money?
ashutosh mishra
(Expert) 19 May 2013
There can not be any legal division of money
that belongs to father.
The father can however GIFT it to his sons daughters and wife and several more relation,where recipients of gift would get it free of tax burden.However the Gift should be properly made so that ITO do not treat it income or cash credit loan in hands of recipients of gifts made to them.
