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Income out of sale of house property.

(Querist) 30 July 2008 This query is : Resolved 
We,4 brothers, are going to sell a house
property for Rs.15.16 lakhs and my share of this gain will be Rs.3.79 lakhs.
Please clarify the following queries:
1)I am a salaried employee and I have PAN.
Any tax is applicable to me or not?
2)If any tax is applicable, what is the rate of tax?
3)How to avoid payment of tax if it is applicable?


Guest (Expert) 30 July 2008
1.Tax on capital gains i.e. difference between cost of acquisition and sale price is taxable, but you buy another house for that gains under section 54EC when you will not liable to tax on gains. You must deposit the gains in Capital Gains Account Scheme in any nationalised bank and withdraw that money to buy the new asset.
2. The rate of tax is 20%
3. answered above.
Murali Krishna (Expert) 30 July 2008
When you are selling property, tax on such property has to be calculated in terms of short term or long term capital gain. If the property remains with you for more than 3 years, it will be long term gain.

In order to avoid tax on the sale price, you have to invest the amount on the purchase of another asset.

For finer details in your question, it is adviseable to contact a good tax consultant.
Srinivas.B.S.S.T (Expert) 31 July 2008
well said As much as i know if you have to aviod caiptal gains then you have to purchase a house for your own occupation. correct me if i am wrong.

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