By Chirag Nangia
* I booked a flat in 2019 and will get possession in July 2024. This flat’s cost isRs 2 crore and till date I have paidRs 1.7 crore. I sold my existing house for Rs 1.45 crore in December last year, which got me long-term capital gains ofRs 1 crore. Can the payment made for the new property be adjusted against LTCG?
Section 54 allows deduction of capital gains reinvested in a new residential property purchased within two years from the date of sale of the original residential property which is the subject matter of capital gain. You seem to be satisfying this condition.
* I sold some shares bought two years ago and made some gains. Will the brokerage house deduct any TDS on the amount of gains or do I have to pay tax at the time of filing the returns. Will the transaction be reflected in the annual information report?
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The broker does not have any obligation to deduct TDS on the sale of shares. Accordingly, you will have to pay due taxes on such sale either by way of an advance tax or at the time of filing of return of income as self-assessment tax. The transaction will be reported in the Annual Information Statement.
* Apart from salary income, I earn rent and interest on deposits. I pay advance tax on the salary income. On the rent and interest on deposits, should I pay advance tax or can I pay it at the time of filing my returns?
Advance tax should be paid up to 90% of the total tax liability for the year in order to avoid levy of interest. You may consider paying advance tax on rent and interest income received, based on the quantum of total tax liability.
* My wife inherited some jewellery from her mother and grandmother. Does she need to pay any tax on selling them?
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Assuming that the jewellery has been held by her mother/ grandmother for more than three years, she will be required to pay 20% (plus applicable surcharge and cess) of the amount of capital gain as tax. Cost of acquisition of the jewellery will be the amount paid by her mother/ grandmother at the time of acquisition.
The writer is director, Nangia Andersen India. Send your queries to firstname.lastname@example.org