capital gain on selling property abroad
lina abood
(Querist) 26 January 2012
This query is : Resolved
DEAR EXPERTS,
I HAD ALREADY POSTED MY ENQUIRY 2 DAYS BACK ABOUT THE PROPERTY I HAD SOLD AND ALL OF YOU AGREE THAT I HAVE TO PAY CAPITAL GAIN.I DONT MIND TO PAY CAPITAL GAIN TAX .BUT WHO WILL DO THE EVALUATION OF MY PROPERTY, BECAUSE IF INCOME TAX MAN DEPEND ON THE FIGURE WHICH IT SHOW ON THE BUYING DEED WHICH IT TOOK PLACE ON DEC/1990 THEN I WILL IN DEEP LOSS BECAUSE THAT TIME WHEN I BOUGHT IT I HAD PAID
RS.6 LACS BUT IT WILL COME RS 9000 ONLY WHICH IT IS TOTALY UNFAIR
ONE MORE THING I GOT IT SOLD FOR AROUND 63 LACS,AND I AM ALREADY HOLDING 2 PROPERTY HERE.
PLEASE SIR GIVE ME YOUR ADVICE BECAUSE I AM REALLY IN PAIN
THANKYOU ALL FOR YOUR MUCH NEEDED ADVICE
Raj Kumar Makkad
(Expert) 26 January 2012
I have my different opinion than of those experts who have opined that you have to pay capital gain in India for your sale/purchase of properties in Iraq.
As you have sold and thereafter purchased properties in Iraq, you have nothing to pay here in India as advised by experts.
lina abood
(Querist) 27 January 2012
sir raj kumar,
thank you very much for going through my post.
the property was marriage gift from my family I bought 1990
this year only I could sell it because I didn't invest in another property till now because I am already having two residential apartment in India,
India government bond will take 50 lacs only then what shall I do with the balance my lose going to huge
PLEASE LET ME KNOW WHAT IS YOUR BEST ADVICE
THANK YOU AGAIN
Devajyoti Barman
(Expert) 27 January 2012
Then also you need not pay if the sale proceeds were largely invested in India.
Vineet
(Expert) 27 January 2012
Ms Lina
I understand the advices being given to you by ld experts here are taking you neither here or there. I see lot of flip flops in your earlier post and this one. Simple Reason : Everyone jumping to conclusion without even bothering to ascertain facts from you.
First thing first, you have to provide the dates of purchase and sale of property in Iraq alongwith consideration paid/ received in local currency. The amounts have to be converted into Indian Rupee as per exchange rate (TT Buying Rate of SBI) as on last day of month immediately preceeding the month in which transfer happened. [Here I wonder How you say that you invested Rs 6 Lakhs whereas the value was only Rs 9000 as per exchange rate]
Now the taxability. If in the year of sale you are tax resident of India [which I presume you are], then your global income is taxable in India. So the capital gains earned by you in selling the property in Iraq are very much taxable in India. Yes you are entitled for indextation of cost being a resident in India. Your CA will explain this to you.
Next, the capital gains so calculated are taxable @20.6% in India. You will get credit for capital gains tax paid in Iraq, if you have proof for the same, against this tax liability.
Now, how to save this tax. You have stated that this was a residential flat. Then you are entitled to avail exemption u/s 54 and 54EC of the Income Tax Act. Depending upon the computation of capital gains, you may invest amount upto Rs 50Lakhs in REC and NHAI bonds (within six months of date of transfer. If still some capital gains remains, you can buy another residential property (a small one). There is no limitation of number of properties for exemption claimed u/s 54.
Hope this suffice. Next time please mention complete facts to get specific answer to your query.
lina abood
(Querist) 27 January 2012
DEAR MR, VINEET,
THANK YOU VERY MUCH FOR YOUR REPLY ,YOU HAD EXPLAIN THE THING SO NICELY ,I WISH IF YOU ARE MY C.A..
DEAR SIR ,THE FLEP FLOP YOU FIND IN MY POST IS TRUE ,BUT NON OF MY FAULT, THE THING WHICH I BOUGHT ONE WEEK BACK FOR 6 LACS GONE TO 9000 RUPEES (BECAUSE OF THE WAR),IT WAS MY BAD LUCK NOTHING MORE
HOPE MY REPLY WILL EXPLAIN THE MATTER FOR YOU ,THANK YOU VERY MUCH AGAIN
YOU REALLY DESERVE 5 STAR
soumitra basu
(Expert) 28 January 2012
If you are permanently residing in India then you have to pay capital gain tax. The same amount can be utilised in purchasing of residential property within 2 years from the date of transfer i.e. to mean that if you sell in the property in the financial year 2011-12 then within 31st March, 2013 you have to purchase the purchase the property without keeping the amount in Bank Account.
