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Property sold for 40 lakhs, do both heirs need to file ITR?

T S Khurana |241 Answers |Ask -Follow

Tax Expert - Answered on Oct 30, 2024

A certified management accountant since 1993, T S Khurana is a fellow member of The Institute of Cost Accountants of India. His areas of expertise are income tax, specifically litigation cases, and GST.

Since the last 21 years, he has also been providing expert advice on financial matters, including investments and diversification of funds, and wealth building in the long term to his clients.
He believes that investment in real estate is the safest way for better returns and wealth generation over a period of time.

A former chairman of the Chandigarh Chapter of Institute of Cost Accountants of India, T S Khurana has also served as member of its technical committee.... more

Asked by Anonymous - Oct 27, 2024Hindi

Money

My father bought a property in the year 2010 in 12lakhs . After his death in 2024, me and my mother sold the property at 40 lakhs through legal heir certificate. My question is do we both need to file ITR or if is it ok if any one of us does it? My mother is a housewife . She has never filed ITR

Ans: Both of you are supposed to file ITR separately, declaring LTCG (50% in each case). Your mother has ever filed an ITR or not, does not matter.
Most welcome for any further clarification. Thanks.

DISCLAIMER: The content of this post by the expert is the personal view of the rediffGURU. Users are advised to pursue the information provided by the rediffGURU only as a source of information to be as a point of reference and to rely on their own judgement when making a decision.

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Mihir Tanna |964 Answers |Ask -Follow

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Asked by Anonymous - Jul 10, 2023Hindi

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Dear Mr.Anil, My mother sold her old house and against it purchased two plots wherein she added me as joint owner (all transactions are from her saving account). Now i have following two questions: 1. Under which ITR form and which head in ITR she has to declare /report following 4 things: sales proceeds, long term capital gain, capital gain tax paid and declare purchase value of plots.( So far, I file her ITR on her behalf every year under Form1 -Sahaj). 2. Do i need to also declare /report purchase of plots while filing ITR ,since she made me co-owner and under what head (I file under form2 as have share investements). Kindly guide ?

Ans: Income from capital gain is required to be reported in ITR 2. Person earning income from sale of investment is required to provide details of personal property held by him/her in ITR if income is more than 50 lacs during the year.

Hardik Parikh | Answer |Ask -Follow

Tax, Mutual Fund Expert - Answered on Jul 18, 2023

Asked by Anonymous - Jul 10, 2023Hindi

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Dear Hardik ji, My mother sold her old house and against it purchased two plots wherein she added me as joint owner (all transactions are from her saving account). Now i have following two questions: 1. Under which ITR form and which head in ITR she has to declare /report following 4 things: sales proceeds, long term capital gain, capital gain tax paid and declare purchase value of plots.( So far, I file her ITR on her behalf every year under Form1 -Sahaj). 2. Do i need to also declare /report purchase of plots while filing my ITR ,since she made me co-owner and under what head (So far I file under form2 as have share investements). Kindly guide ?

Ans: Namaste,

I understand your situation and I'll try to provide a simple explanation.

For your mother's case, since she has sold a property and made a long-term capital gain, she will need to file her Income Tax Return (ITR) using Form 2 instead of Sahaj (Form 1). The reason being, Form 1 is for individuals having income from salaries, one house property, other sources (interest etc.) and having total income up to Rs 50 lakh. However, in your mother's case, there is a capital gain involved, so Form 2 is more appropriate.
The sale proceeds of the house will be reported under the head 'Capital Gains'. The purchase value of the plots will be reported as the 'Cost of Acquisition' under the same head. The capital gain tax paid will be reported in the 'Taxes Paid and Verification' section.
As for your case, since you have been made a co-owner of the plots, you should also declare this in your ITR. However, as you have not contributed to the purchase, it will not have any tax implications for you. You can mention it under the 'Asset and Liability' section if your taxable income exceeds Rs 50 lakh.
Please note that this is general advice and the exact details may vary based on the specifics of the transactions. It's always a good idea to consult with a tax advisor or chartered accountant to ensure all details are accurately reported.

Mihir Tanna |964 Answers |Ask -Follow

Tax Expert - Answered on Jul 23, 2023

Asked by Anonymous - Jul 18, 2023Hindi

Money

My mother sold her old house and against it purchased two plots wherein she added me as joint owner (all transactions are from her saving account). Now i have following two questions: 1. Under which ITR form and which head in ITR she has to declare /report following 4 things: sales proceeds, long term capital gain, capital gain tax paid and declare purchase value of plots.( So far, I file her ITR on her behalf every year under Form1 -Sahaj). 2. Do i need to also declare /report purchase of plots while filing my ITR ,since she made me co-owner and under what head (So far I file under form2 as have share investements). Kindly guide ?

Ans: For the income tax purpose, person who make the payment at the time of acquisition of property, is considered as owner. By adding name is agreement, ownership for the income tax purpose will not be decided.

Further to report gain from capital gain, ITR 2 is applicable.

T S Khurana |241 Answers |Ask -Follow

Tax Expert - Answered on Aug 26, 2024

Asked by Anonymous - Aug 06, 2024Hindi

Money

My father died in FY 24-25 a 3 months back. A home in which I am living is in the name of my late mother and my late father and my wife. My queries are : 1. Now, only my wife is alive so, Is there any need to transfer the property in my wife's name ? 2. There is income from the rent of 2 separate floors, how this rent now to be shown and in whose ITR. Me and my wife also file ITR 2 currently. 3. My Father was getting the pension and filling the ITR for the same. Do I need to file his ITR as a legal heir or as a representative. 4. What need to be done to get his legal heir status. I am having 2 married sisters also. If you can reply serial wise I shall be obliged. Kindly state any other advise wherever required. Regards.....

Ans: I offer my opinion on your above questions, point wise as under :
01. First of all refer to the "WILL" of your Father & Mother. Their share should be transferred, in the name of the beneficiary of the WILL, may be you, your wife of anybody else.
02. Till the date of death, your father & mother are entitled to 1/3 RENTAL INCOME EACH.
03. You are supposed to file ITR of your Father & Mother, after their death, till the date they were alive, along with their all other Income, whether from pension or any other source. ITR should be filled by you as their legal heir/representative asessee.
04. Portion of rental income of your wife, shall be continued to be shown in her ITR.
05 When property share of your father & mother is transferred in the name of beneficiaries, they will be responsible to show this income in their ITRs.
06. If there is "REGISTERED WILL" property can be transferred in the name of beneficiary. If there is no "WILL" then the property shall be divided among all legal heirs equally. However, some of the stake holders may opt for having no share in the property.
Most welcome for any further clarifications. Thanks.

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DISCLAIMER: The content of this post by the expert is the personal view of the rediffGURU. Investment in securities market are subject to market risks. Read all the related document carefully before investing. The securities quoted are for illustration only and are not recommendatory. Users are advised to pursue the information provided by the rediffGURU only as a source of information and as a point of reference and to rely on their own judgement when making a decision. RediffGURUS is an intermediary as per India's Information Technology Act.

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