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 ?
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.