what is my tax liabilty on sale of property by lady senior citizen ?

I have purchased a flat in 1989 for a consideration of Rs.2 Lac. i am selling the same house for Rs.20 lacs in Jan 2010. With the indexation what will be my tax liability. I am 80 years old and presently has no income or it is better to give gift to my son

2 Replies to “what is my tax liabilty on sale of property by lady senior citizen ?”

  1. Sale price of flat sold by you will be deemed the price adopted by stamping authority for stamp purposes as per provision of section 50 C of the income tax act 1961. It may be more than Rs 20 lacs. Supposing the said deemed price is Rs 20.00 lacs then calculation of income tax will be as under.
    Deemed sale price of Flat 20.00 lacs
    Less- Indexed Cost of acquisition
    2.00*582/161 7.23 lacs
    Long Term Capital Gain 12.77 lacs

    Since inflation index for the financial year 2009-10 is not yet notified by CBDT the above calculation is based on FY 2008-09 inflation index. After new index for fy 2009-10 the above profit will be lesser.

    Income Tax on above capital gain will be-
    Income Tax 2.07 lacs
    Education cess 3.00% 0.06 lacs
    Total Tax 2.13 lacs

  2. CFI for 1989-1990 – 172
    CFI for 2009-2010 – 632

    Indexed purchase price = Rs 7,34,883

    Sale price = Rs 20,00,000

    LTCG = Rs 12,65,117

    Tax @ 20% + surcharge + cess

    You have to decide whether you want to sell it off or gift it to your son. Do not invest in sentiments. Be practicle.


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