Hi Srikanth,
My father has sold a residential house in June 2018 for 58 lakhs. He bought it in 1998 for 2 lakhs and cost of construction at that time was 3 lakhs. In 2012 he took home building loan from his office for improvement @ 2.25 lakhs. My questions are:-
1. Cost of indexation and capital gain arising out of the sold property.
2. Can my father buy plot in joint name with my mother also?. Will capital gain tax exemption be given in that case.
If the whole capital gain is reinvested in buying of plot, is it necessary to construct the plot within 3 yrs?
1 Answers
Hi,
1 - Suggest you to kindly consult a Chartered Accountant for accurate and exact CG calculations.
2 - Yes, he can buy the property in joint-names. The LTCG capital gain exemption can still be claimed. If you plan to use the gains to build a house, it has to be done within three years of the sale of the property. Do note that ‘cost of land’ can be included in the construction cost.
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