Auditorwala

Steps

Just fill the form and our CA's will contact you regarding the Sale of Property(Capital gain Tax Planning).

Filling out the form is quick and easy and will provide you with numerous benefits in the long run. By this, you will be able to get consultation from our Auditorwala CA/CS and will be able to get Guidance. So, why wait? Take the first step towards a bright future for your business and fill out the form today.

To arrive at the Short Term Capital Gains – From the total Sale Price of the asset deduct cost of acquisition, expenses directly to sale, cost of improvements(if any) also deduct exemptions allowed under section 54(as applicable, we’ll see below what these are) – > the resulting amount is the Short Term Capital Gain.
In case of Long Term Capital Assets, the only difference is, one is allowed to deduct Indexed Cost of Acquisition/Indexed Cost of Improvements from the sale price. Indexation is done by applying CII (cost inflation index). This increases your cost base (and lowers your gains) since the purchase price is adjusted for the impact of inflation.

STCG are included in your taxable income and taxed at applicable tax rates basis your slab. See latest slab rates.

LTCG are taxed at 20%

Long-term capital gains are exempted from taxation (under Section 54 of the IT Act, 1961) for individuals and Hindu Undivided Families on the sale of a house property if:

Capital gains are used to purchase or construct another house;

New house is purchased one year before or two years after the sale of the old house;

The new house is constructed within 3 years after the sale of the old house;

Only one additional house property is purchased / constructed;

You don't sell the new house for 3 years after taking possession of it.

If the cost of the new property is lesser than the sale amount, the exemption then only applies proportionately. The remaining money can be re-invested under Section 54EC in under 6 months.

The tax implications of selling a property depend on various factors such as the type of property, the length of time the property was held, and the amount of profit earned from the sale. Capital gains tax may apply to the sale of a property.

How to save Capital Gains Tax on Sale of Land

Land is a Capital Asset and and as an appreciated asset, a landowner can make huge capital gains on its sale. However, agricultural land in a rural area in India is not considered a Capital Asset. So, no capital gains are applicable on its sale. Before we find out how your capital gains shall be taxed, do make sure Income Tax considers your asset to be a capital asset.
Short-term or long-term capital asset

Land is a short term capital asset, when held for 36 months or less (i.e. up to 3 years). If held for more than 36 months, it is considered a long-term capital asset. So tax implications too vary based on the duration for which you own an asset.