By Admin | 
Selling property in India can be rewarding, but it also triggers a tax liability known as capital gains tax on property. Whether it’s a house, plot, or inherited asset, profits from the sale are taxable under the Income Tax Act. The amount of tax depends on how long you’ve owned the property, and there are legitimate ways to reduce or even avoid it.
Understanding the rules around short term capital gains tax on property, long term capital gains tax on property, exemptions, and indexation can help you keep more of your earnings while staying compliant.
Capital gains are categorised based on the holding period of the property:
A capital gains tax calculator on sale of property can help you estimate the liability. The basic formula is:
Sale Price – (Indexed Purchase Price + Transfer Expenses + Cost of Improvement) = Taxable Capital Gains
For ltcg tax on property, indexation significantly lowers your taxable profit, while for short term capital gains tax on property, the entire gain is taxed without adjustment for inflation.
If you’re wondering how to save capital gains tax, the Income Tax Act provides multiple options:
Legally, you can avoid capital gains tax on property by:
Trying to evade tax without meeting these legal conditions can lead to penalties, so always follow the prescribed process.
With Pune’s real estate market seeing steady growth, averaging ~8-10% annual price appreciation in prime corridors, selling property can mean significant gains. For example, upcoming projects by real estate developers in Pune in areas like Punawale, Hinjawadi, and Wakad have drawn investor interest, leading to higher transactions and more capital gains events.
Capital gains tax is a key factor in real estate transactions. Knowing whether your sale attracts short term capital gains tax on property or long term capital gains tax on property, and being aware of exemptions like section 54 capital gains or exemption under section 54EC, can help you reduce your liability.
If you’re looking to reinvest your gains smartly, Pharande Spaces offers projects like Puneville, ideal for buyers seeking 2 BHK flats in Punawale or larger configurations. Working with reputed real estate developers in Pune ensures your investment aligns with your lifestyle while optimising your tax benefits.
By Admin