I am presently contemplating the sale of land that I had inherited in Bangalore. I live in London and am not sure whether there are any Indian taxes that would be payable on the sale proceeds in India. Can anyone please provide further guidance on this issue?
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  • Capital gain Tax payable

    Dear Praveen
    If you have been holding the Land for more than 3 years.. You come in the bracket of Long Term Capital Gains
    If you sell that land and dont buy any other real estate in india, you have to pay 20% capital gain on the notional profit made ( Difference in Sale Price and cost price). Since in this case, you have inherited the land, the market value of that land as on the date you inherited, is considered your cost of accquisition. You would get the benefit on indexation and your capital gain would be less than 20%.

    If you have been holding the Land for less than 3 years.. You come in the bracket of Short Term Capital Gains
    You will have to pay almost 30-33% Gain Tax on the notional profit. You do not get any exemption even if you buy any other property

    Hope you find the info useful
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  • Wow!!!

    The information from Pinnacle is useful, comprehensive and to the point.
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  • Question for Pinnacle

    Thankyou Pinnacle , the answer to Mr.Sharma on Capital Gains was really helpful for me as well. Thanks .

    Have a question for you ? just wanted to share your thoughts over it .

    I hold a foreign passport ( only 2 months back I got , till then had a Indian Passport / I have a Pancard and already a taxpayer in India ) . In this situation if I want to invest in real estate mkt. say for example On my self owned land want to start a construction company , business of construct / build, sell houses etc ..

    How is it I am going to be effected .

    Please do let me know , your thoughts .

    Regards

    Amber
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  • Realty in India

    Originally Posted by Myhome
    Thankyou Pinnacle , the answer to Mr.Sharma on Capital Gains was really helpful for me as well. Thanks .

    Have a question for you ? just wanted to share your thoughts over it .

    I hold a foreign passport ( only 2 months back I got , till then had a Indian Passport / I have a Pancard and already a taxpayer in India ) . In this situation if I want to invest in real estate mkt. say for example On my self owned land want to start a construction company , business of construct / build, sell houses etc ..

    How is it I am going to be effected .

    Please do let me know , your thoughts .

    Regards

    Amber



    Hi Amber
    You accquiring a foreign passport doesnt affect your right of buying and selling properties in India. Currently, foriegners are not allowed to buy real estate in India, except in Goa.

    Persons who are allowed to but are indian,s NRI's and Person of Indian Origin (PIO).

    You can surely build on your land and sell those properties

    Hope this helps
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  • I can fit in.

    This is a great post and makes me think of where I can fit in. I do a little bit of everything mentioned here and I guess I have to find my competitive advantage.
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  • Dear friend,

    Looks, same contents/posting I have read in other threads also?

    ks2071746
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  • Capital Gain tax

    Hi
    If proceeds from long term capital gain on real estate is used to pay a bank housing loan, taken before selling the property(within 6 months) then is long term capital gain tax applicable.

    Regards
    Piyush

    Originally Posted by Pinnacle
    Dear Praveen
    If you have been holding the Land for more than 3 years.. You come in the bracket of Long Term Capital Gains
    If you sell that land and dont buy any other real estate in india, you have to pay 20% capital gain on the notional profit made ( Difference in Sale Price and cost price). Since in this case, you have inherited the land, the market value of that land as on the date you inherited, is considered your cost of accquisition. You would get the benefit on indexation and your capital gain would be less than 20%.

    If you have been holding the Land for less than 3 years.. You come in the bracket of Short Term Capital Gains
    You will have to pay almost 30-33% Gain Tax on the notional profit. You do not get any exemption even if you buy any other property

    Hope you find the info useful
    CommentQuote
  • I was told by someone that if property was inherited then there is no capital gains tax but rather an inheritance tax and then you pay wealth tax/income tax at the end of year.

    Can anyone confirm or deny this?

    Secondly what is considered the date of acquisition in case of inheritance? Is is the date the title was transferred to the cooperative society with the new owner's name?
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  • Tax on India Property - UK Solicitor

    Dear Praveen Sharma

    The advice from Pinnacle is clear and concise in so far as your question is concerned.

    However, as you live in the UK, I assume you are a British taxpayer. In that case there are also obligations on you to declare this to the UK Tax Authorities.

    You will also need to deal with the repatriation of funds, if you would like to transfer the money to the UK

    Should you need assistance in India or the UK, I would be glad to help.

    RSK Singh
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  • Landsale of pre1981

    We are a family of four brothers and had an ancestral property. We got into a development agreement with a builder and later a sale deed. According to the agreement we would receive 15 lakhs each and 3 flats each on the property (which we have not received yet since the last two years). For tax calculation purpose, we got the property assessed as it was pre-1981 by a valuer. The value of the land worked out to two crores. My question is about myself. On what amount would the tax be calculated on 15 lakhs I have received or on the 2 crores which is the value of the land as per 1981 assessment? If on 15 lakhs then how much is the tax and under what section? If on 2 crores the tax is calculated then under what section?
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