How to show sale of property in income tax return?

To answer your query, how to show sale of property in income tax return, let me tell you that the sale consideration is the actual amount you receive from the buyer. If the property is sold below the circle rate (minimum price set by the government), the circle rate is considered for tax purposes.

How to Show Sale of Property in Income Tax Return?

• For LTCG, index the cost of acquisition and any capital improvements made. Use the Cost Inflation Index (CII) for this. Multiply the cost of acquisition with the CII of the year of sale divided by the CII of the year of purchase.

• Report the capital gains in Schedule CG of ITR-2.

• Mention the sale consideration, indexed acquisition cost, improvement cost, and the net capital gain.

• If applicable, provide details of any exemptions claimed.

• Pay the tax on capital gains before filing the ITR. Use Challan 280 to pay any tax dues.

This is

how to show sale of property in income tax return

.

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Is it mandatory to show sale of property in ITR? Yes, and for this

, you need to follow some steps. I’d like to share the steps with you all.

How to Show Sale of Property in ITR?

• The first step is to determine the type of property you have sold. It could be residential, commercial, land, or any other type of property.

• Calculate the capital gains arising from the sale of the property. Capital gains are calculated by deducting the cost of acquisition (purchase price), cost of improvement (if any), and certain allowable expenses from the sale proceeds.

• Capital gains are categorized into short-term capital gains (if the property was held for less than 2 years) and long-term capital gains (if the property was held for 2 years or more).

• Different tax rates apply to short-term and long-term capital gains.

• Determine the appropriate Income Tax Return (ITR) form to file based on your income sources and other criteria. In the ITR form, there will be specific sections where you need to disclose capital gains.

• You may be eligible to claim certain exemptions or deductions under the Income Tax Act to reduce your taxable capital gains. 

For example, exemptions are available under sections like 54, 54F, 54EC, etc., for reinvesting the sale proceeds in specified assets like another property or bonds.

• Verify the information provided in the ITR form and file your income tax return electronically using your Aadhaar card, net banking, or by generating an Electronic Verification Code (EVC).

• If you have taxable capital gains after applying exemptions and deductions, ensure that you pay the applicable tax on the gains before the due date.

Your query for is it mandatory to show sale of property in ITR should be solved.

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To comply with tax regulations and guarantee accurate reporting of your financial activities, you must include the sale of a property in your income tax return. Here’s a step-by-step guide on how to file ITR for sale of property. Your reported gain or loss will be determined by the discrepancy between the property's adjusted basis and the selling price.

How to show sale of immovable property in ITR?

Do you know that if you've sold a home, piece of land, or building, you must file an income tax return using the ITR-2 form. 

• Visit the official website of the

  Income Tax department e filing

  and log in

• Follow e-File> Income Tax Returns> File Income Tax Returns.

• Individuals now have to choose the assessment year, the status, and the form type. 

• The next step is to choose "Taxable income is more than the basic exemption limit" as the ITR filing reason.

• The five types of schedules are displayed on the following page. The 'General' option must be chosen and then click on the 'Income Schedule' option. 

• Next one must select the sort of capital asset from the offered list by clicking on "Schedule Capital Gains". 

• Click on 'Add details' in order to report STCG. Then they must include the COA (Cost of Acquisition) for a specific FY in addition to the consolidated amount realised from the sale of short-term assets.

• When filing ITR 2, people must include scrip-by-scrip information for long-term capital gains. This will include the ISIN, the selling and buying prices, the dates of the various transactions, and more. 

• One must click "Add" after entering these facts in "Schedule 112A". 

• People must examine Part B TTI and then tap on 'Preview Return' after the relevant schedules have been 'Confirmed'. They must now download the ITR and start the declaration process.

• Taxpayers must provide specified information on the declaration tab before clicking on the "Proceed to Validation." 

• The ITR submission needs to be confirmed after validation. People can confirm electronically or by delivering a printed copy of their signed ITR-V to the Bangalore office of the Income Tax Department. 

Follow the aforementioned instructions on how to report sale of property on tax return.

Keep in mind that you must verify your ITR within 120 days of filing. While understanding how to file ITR for sale of property, it is very important to enter proper data in each section and to double-check them before completing the ITR form.

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You must have read other answers in the comment section and figured out that the seller needs to pay capital gain tax on property sale. In case you have sold your property in FY 2022-23, my answer is for you. You will need to file an Income Tax Return (ITR) before the due date to make the most of your benefits. Keep reading to know more. 

According to section 194IA of the Finance Act 2013, income tax on property sale needs to be paid when the sale price of the property is equal to or exceeds Rs. 50,00,000/-. Generally, tax on selling property in India needs to be furnished in form ITR-2. Those who have made money from house property, capital gains/loss on sale of investments/property information need to fill out the form. Sellers will need to mention TDS as well. This can be done in Form 26QB. Anamika, has very well mentioned above how to fill ITR 2, so I’m skipping that part. 

Let me share with you the process to fill form 26QB :

Visit the official TIN Protean website​ ( https://www.protean-tinpan.com/ ).​ 

On the homepage, choose TDS on the sale of the property

Then, click on "Online form for furnishing TDS on property (Form 26QB)" 

You will then need to choose the applicable challan as "TDS on Sale of Property". 

Fill out the form. You will need to mention the following details. 

1. PAN of the seller & buyer 

2. Contact details of seller & buyer 

3. Property details 

4. Amount paid/credited & tax deposit detail

5. Finally, submit the duly filled form 

6. A confirmation about your form being submitted will appear on the screen. 

7. I would advise you to save the acknowledgement number for future inquiry.

    

If you have any other questions on capital gain tax on property sale, leave them in the comments below. 

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I did not know much about Income Tax Return but recently after selling a property at a good price, my father seemed confused and called over his friend. When I asked him the reason he said that he did not know how to show sale of property in Income Tax Return India. I asked him if it was necessary. He looked at me and said of course. We have earned a great profit here and if I don’t show it in the file, I will be having serious trouble in future. So let me share how you can do it.

How to show property sale in ITR?

First, do know that Long Term Capital Gains on sale of a property are taxed at 20% plus a cess of 3% on fulfilling some conditions. If you got a property as a gift or even inherited it, then also you will have to showcase them and give capital gains tax on it. Here are the steps to tell you vividly how to show it.

You have to file ITR 2 form and then file the ITR following these steps:

• Login using your credentials on

• Click on income source and provide your income details as required or upload your Form 16

• Locate your taxable income in Form 16

• Provide the salary TDS amount

• Provide your other source of income

• Declare the tax exempt if any

• Click on sold any assets option and add details as needed

• Add date of sale, price, brokerage charges under section 54, 54EC and 54F as needed

• Click on Go Next

• Enter the total of your Section 80C deductions

• Add details about TDS if not automatically it gets done

• Download it and everything is done

The Sale of property in ITR filing is long but not hard so do not ever miss filing it. 

People tend to ignore or even forget filing their gains which is definitely not encouraged. My father said that if our government gets to know, you will have to pay a huge amount of extra money and can even be jailed. I hope this this answer which ITR to file for sale of property- it is ITR-2.

This is all that I got to know from my father. I hope this answers your query on  how to show sale of property in Income Tax Return India clearly now.

You must know that any profits from the sale of an asset should be reflected in the Income tax return. It just depends if you have a long term capital gain or short term capital gain. Anyway, if you have any profits to show in case you have sold a property then you will have to fill ITR 2. I will share the specifics on how to show sale of property in income tax return. Read through.

When you are filing income tax return and you have received capital gains (long term or short term) you have to declare them. However, if you have not received the capital gains then you don’t need to declare in the ITR. the particulars you are required to share in the ITR form 2 are:

• General Personal Information

• Details of Income from Salary

• Details of income from house property (Schedule HP)

• Capital gains (Schedule CG)

• Schedule 112A (For sale of equity shares) among many others

There are two parts to this schedule - 

You will have to disclose full value of the consideration received/receivable, value of property as per stamp valuation authority, cost of acquisition without indexation, cost of Improvement without indexation, expenditure wholly and exclusively in connection with transfer, short-term Capital Gains on Immovable property. 

You will have to disclose amounts deemed to be long term capital gains, fill up schedule PTI (B11a + B11b), enter the amount of LTCG included in B1-A8 but not chargeable to tax or chargeable at special rates in India as per DTAA. Disclose income chargeable under the head “CAPITAL GAINS” (A9 + B13), deduction claimed against Capital Gains, accrual/receipt of capital gain.

I hope now you have an idea on how to show sale of property in income tax return.