I am based in UK. Me and my brothers are the heirs to an ancestral property in INdia.We recently sold it and i have received my share.I would like to know about whether i would be and how much i would be taxed on this.Kindly let me knw asap.The land was bought somewhere around 1960
1 Answers
It will be considered as a long term capital gain (LTCG) and taxed at 20% after indexation.
In order to compute the gain, below method has to be followed:
For computing capital gain with indexation, cost inflation index (CII) for purchase year is needed, which was only started in 1981-82, so Govt gave an option to consider Fair market value (FMV) in 1981-82 for all properties purchased before that.
Purchase Year = 1981-82
Purchase Cost (FMV in 1981-82) = X
CII for purchase year (81-81) = 100
Sale Year = 2010-11
Selling price = Y
CII for sale year = 711
Indexed Purchase price = X(711/100) = P
Long term capital gain = Y-P = Q
Income tax on capital gain = Q x 20%
Now your share in this capital gain will be same as your share in property.
I have purchased land in 97-98 but it could not get its mutation in my name which is done only this month. Now I want to sale the land. Please let me know about tax position on this. I am a saliered person.
Property ownership starts when registration is in your name. If its sold before three years of ownership, short term capital gains would be applicable. STCG is taxable as per tax slab rates and no tax benefit is available for such gains.
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