Property Sale & IT


I sold my property last financial year and invested the proceeds from the sale in my sons property. I was a government employee last year and am now a pensioner (starting this financial year). While filing the IT returns, should I declare the money received from the sale of property. If yes, where and how should I declare it?

Thanks Mahesh

asked Jul 08 '14 at 09:45 by vikram172 125

As you sold property, you would be liable to pay income tax on capital gains arising from such property sale.

You can avail income tax benefit by investing such gains into residential house property u/s 54 and 54F. But gains and exemption should be declared in income tax return. You will have to use ITR-2 form.

Below method is used to compute capital gains
Purchase Year = A
Purchase Cost = P
Cost Inflation Index (CII) for purchase year = X

Sale Year = B
Selling price = Q
CII for sale year = Y

Indexed Purchase price = P x (Y/X) = R
Long term capital gain = Q - R = S
Income tax on capital gain = S x 20%

answered Jul 11 '14 at 14:13 by Pankaj Batra 5.2k320


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Asked: Jul 08 '14 at 09:45

Seen: 1,595 times

Last updated: Jul 11 '14 at 14:13