Our flat was bought in Sep2022 in my wife's name for 70 lakhs and transferred to my name in June 2023 on her demise. If I sell this flat now for 80 lakhs, what will be the capital gains to be added to the 30% tax bracket?

Ans: Hi Alok
Buying a plot is not considered as reinvestment and eligibility is on buying or constructing a residential house.

In this case if you construct a house on the plot then you could map the capital gains from the sale of the ancestral house against the cost of construction of the house on the plot.

Also, as you have sold the house in March 2023, you would need to open a Capital Gain Accounts Scheme (CGAS) account with any nationalized bank on or before the due date for filing your tax return. The deposit of the capital gain amount in the CGAS account would be treated as reinvestment for the moment.

You need to note that this CGAS account amount has to be utilized for construction within 3 years from the date of sale of the ancestral house.

In case you are not depositing the amount in CGAS account or reinvesting in any eligible assets before filing tax return (of course before due date) then you would need to pay tax on the capital gain portion

Ans: Capital gain amount is derived by deducting indexed cost from sale consideration.

Assuming residential property is acquired in FY 2012-13 in 40 lacs, indexed cost will be Rs.69,60,000 and accordingly there will capital loss.

You can calculate the indexed cost from the income tax calculator https://incometaxindia.gov.in/Pages/tools/indexed-cost-of-acquisition-or-improvement.aspx

Ans: 01. Yes. This transaction would be subject to Capital Gain Tax.
02. Under present provisions of Income Tax Act, you may opt any of the options (in case of Long Term Capital Gains), as under :
(a). Tax Rate 12.50% without indexation or
(b). Tax Rate of 20% with Indexation.
03. You may calculate your tax liability under both options & may opt for the tax regime, where tax liability is minimum.
04. Most welcome for any further clarifications. Thanks

Ans: Based on the limited information
Tax liability shall be
Without indexation Rs.273000
With Indexation Rs.195000