Sell ??your house? Changes in the tax rate you need to know

Finance Minister Arun Jaitley in his first Budget proposed to amend the sale of the property capital gains tax law. The tax-cap on the amount of finance minister in the specified bonds, also known as capital gains bonds, long-term capital gains on the sale of investment properties of. Mr. Jaitley also clarified that the investment should be in India to invoke the benefits of a long-term capital gains for residential property.

At the current tax rules, the sale of property held by long-term capital gains for three years, the percent of revenue, attracting 20. Exemption under certain conditions inevitable. These proposed changes tax law.

Capital gains on residential property tax exemption: Under current tax law, the sale of long-term capital gains are tax-free capital asset formation under section 54 / 54F, if the investment purchase or construction of small property right, under certain conditions. In order to get income tax exemption captain, you need to pre-assessment or the original house within one year after the transfer of two-year term to purchase new homes. For properties under construction, the construction must be from the date of transfer of the original house from three years to complete.

Has now been clarified, access to capital gains effective investment should be located in India, rather than a residential house property rights abroad. This amendment will apply to subsequent years and the year of assessment 2015-16.

For long-term capital gains tax-free bonds invoked: Many investors who sell property, the amount of capital gains by investing in specified bonds, also known as capital gains tax saving bonds long-term capital gains. Who wants to claim that the long-term capital gains tax exemption from the subject with the date of sale or tax returns, whichever is earlier in the first six months, investment in capital gains bonds. The advantage of this is up to Rs restrictions under section 54- EU 1961 Income Tax Act to use. 500,000 rupees in a financial year.

It is now clear that the exemption should be limited to the total long-term capital gains for investment in capital gains bonds of Rs. 500,000 rupees. This amendment will apply to subsequent years and the year of assessment 2015-16.

Advance sale of property and confiscation: It was suggested that any received in advance, and later confiscated personal sale of capital assets class units, if the transaction does not occur taxes. If negotiations can not lead to capital assets and funds transfer is taken in advance confiscated by the evaluation, then the amount of the taxable income from other sources, "the head in the same year. Under current rules, the money from the cost of acquisition of assets, while reducing capital gains year to determine the subsequent sale of capital assets. This amendment will apply to subsequent years and the year of assessment 2015-16.
SOURCE : WEB