Kindly clear my doubt about capital gains tax on LTCG. I sold my flat during 2021 thus received LTCG. During 2018 I signed an agreement to buy a flat and paid 90% of cost of new flat to owner of flat. Now I have to pay him 10% remaining cost to get the flat registered in my name. Can I show new flat purchased after getting registration done as investment to save tax on LTCG?

Ans: If you want to save tax, you must buy the residential house property 1 year before or 2 years from date of such transfer of capital asset or construct the house property within 3 years from date of transfer of such capital asset. As i understand, you will buy (not construct) house 1 year before transfer of old, exemption is available subject to fulfillment of other conditions. Date of Possession will be important for calculation.

Ans: In case of gift, date of acquisition and cost will be of the previous owner. Thus, in my view, date of acquisition and cost will be of original owner who spent money in acquiring the asset. If original owner acquired before 1.4.2001, FMV as on 1.4.2001 will be cost.

Ans: Hi,
There are lot of ambiguities in your query. Certain questions that are pertinent are as follows:

Was the Rs. 17 Lakhs fully paid in 2002?
How was the possesion given in 2003 without registration and it was done only in 2016?
What was the proportion of payment that was made by you individually and your husband?

The answers to this query would change based on inputs to the above questions. However, i will try to give a generic response to your queries

Indexed Cost of Rs. 17 Lakhs - Rs. 56,34,286
Indexed Cost of Rs. 1.65 Lakhs - Rs. 2,17,500
Total Indexed Cost - Rs. 58,51,786
Sale Consideration - Rs. 95 Lakhs
Long Term Capital Gain - Rs. 36,48,214

Most critical point here is that this capital gain would be taxed in the hands of your husband and not you as he has gifted the property to you without any monetary consideration. This is based on the clubbing provisions of the Income Tax Act

Ans: For calculating tax on long term capital gain on house property, indexed cost of acquisition is required be reduced from sale considered.

Indexed cost of acquisition can be calculated with the help of income tax calculator available at https://incometaxindia.gov.in/Pages/tools/indexed-cost-of-acquisition-or-improvement.aspx.

Property is booked in 2004 but payment would have done gradually till 2014. Thus, indexation benefit is available on each of the payment from each of date of payment.

Ans: Considering the information rendered by you, I assume that you will be able to sell your existing house property within one year from the date of purchase of a new house.

If so, you will be able to claim the exemption in respect of long-term capital gains arising on the sale of the present house provided you invest the proceeds in construction/acquisition of the house under section 54F.

Thus, I would suggest to repay the loan with capital amount received from sale of house.