LTCG Tax exemption on Sale of PLOT

Q & A Forum › Category: Real Estate › LTCG Tax exemption on Sale of PLOT

ca.vikram81 asked 8 years ago

Dear Sreekanth, I have one query on Capital gains from sale of Plot. Have bought one plot in July 2013. Now planning to sell the same. Is this mandatory to have the plot registry in place? I have paid all the dues in 2013 and have No due certificate from builder dated Nov 2017. Kindly let me know if this is going to be LTCG or STCG and tax rate. Thanks a lot !

ca.vikram81 replied 8 years ago

Thank u. This is a plot. Can we save gains by investing in REC / NHAI Bonds and would indexation be applicable for calculating capital gains

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Sreekanth Staff answered 8 years ago

Hi, You will be receiving Long term capital gains on this transaction. Long Term Capital Gains are taxed at 20%. As you have paid all the dues and have the right of ownership in the said property, date of agreement/allotment can be considered for calculation of Capital Gains. By this by is this Plot or Flat? Related article : https://www.relakhs.com/how-to-save-capital-gains-tax-on-sale-of-land-house-property/

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Sreekanth Staff answered 8 years ago

Hi, Yes, Capital gains from sale of any long-term asset can be claimed as tax-exempt under Section 54EC of the Income-Tax Act by investing in notified bonds within six months of the transfer of Asset. Indexation benefit can be claimed. Kindly go through above mentioned article!

ca.vikram81 replied 8 years ago

Thanks a lot. Appreciate quick and clean reply !!

Sreekanth Staff replied 8 years ago

Hi,
The lock-in period of these bonds have been increased from 3 years from 5 years from FY 2018-19, as per Budget 2018-19.

If Bonds are issued on or after 01-Apr-2018, their lock-in period would be 5 years.

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CRK Reddy answered 8 years ago

Dear Sreekanth, I own an residential apartment on my sole name since 2014. I have purchased a Second apartment and paid 100% from my personal funds and registered in Dec 2017 on my sole name. Now I intend to sell an residential plot and expect to register it to the buyer by end of March 2018. Can I consider the LTCG arising from this sale as amount spent on purchase of the Second flat in Dec 2017 and claim LTCG tax excemption ? Appreciate your advice. Regards

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Sreekanth Staff answered 8 years ago

Hi, I believe you can claim LTCG.
Kindly consult a CA as well. Related article : https://www.relakhs.com/how-to-save-capital-gains-tax-on-sale-of-land-house-property/