How is capital gains tax calculated?
- If the first 50% share was held for more than 24 months, the gain on that portion can be LTCG.
- If the remaining 50% was purchased only one year before the final sale, the gain on that portion can be STCG.
What if the property was owned 100% from the beginning?
- If the taxpayer bought the other 50% later: The original 50% would have a ₹45 lakh gain ( ₹75 lakh − ₹30 lakh), while the later-bought 50% would have a ₹25 lakh gain ( ₹75 lakh − ₹50 lakh). In this case, the total capital gain will be ₹70 lakh.
- If the taxpayer had owned 100% from the start: The total capital gain would be ₹90 lakh ( ₹1.5 crore − ₹60 lakh).
How Section 54 exemption can be claimed?
- Purchased within one year before or two years after the sale, or
- Constructed within three years after the sale
Disclaimer: This is meant for informational purposes only. Please consult a qualified tax expert before making any financial decisions.