I have purchased flat in 2018, took mortgage loan in 2019. If i sell my flat and repay my house mortgage loan on same property, do I have to pay long term capital gain tax.
Ans: Hello Laxman,
As a tax advisor, I can confirm that if you sell your flat and use the proceeds to repay your mortgage loan on the same property, you will still be liable to pay long term capital gains tax.
The calculation of long term capital gain tax will depend on various factors, such as the purchase price of the flat, the sale price, and any deductions you can claim, such as the cost of improvements or repairs you made to the property.
However, there are certain exemptions and deductions available under the Income Tax Act, which you can consider to reduce your tax liability. For instance, you can claim an exemption under Section 54 of the Income Tax Act if you invest the sale proceeds in another residential property or certain specified bonds within a specified period.
To conclude, it is advisable to consult a tax expert or a chartered accountant to understand your tax liability and explore all the available options to minimize your tax burden.