Prajna Capital - An Investment Guide

Any gain or loss arising on transfer of property is subject to the tax provisions under the head 'capital gains'. Under the provisions of Section 2 (14) of the Income Tax Act 1961, 'capital asset' means property of any kind held by an assessee. It does not include certain items like stock-in-trade, consumables or raw materials for business, and personal effects and certain agricultural categories of land. Any real estate, including a flat, building, site, farm house, and commercial property is subject to capital gains on sale or transfer. It is not only sale of property which triggers off capital gains. Even certain specified forms of transfers are deemed as sale, and any gain is subject to capital gains tax. Transfer of property means a person conveying property, in the present or future, to one or more other persons, or to himself. Any income arising on transfer of a capital asset is subject to capital gains tax. Transfer is deemed to have taken place on the da...

Some rules that specify when a tax deduction is available Property is an important source of income. In case you own a residential property, it may either be self-occupied or rented out. If you rent out the residential property, a rental income is derived. Leasing out property and renting out property mean the same. The rental income earned is taxable in the hands of the recipient. It is taxable under the head 'Income from House Property'. The tax liability is calculated according to the provisions of Sections 22 to 27, after allowing for the admissible deductions. No deductions are allowed except those specified by the Income Tax Act. In case you have rented out your commercial property, the income earned from this source is also be taxable. It is taxable under the head 'Income from Business and Profession'. The lease rent earned through leasing out commercial property constitutes business income for the owner of the property. As such, it is taxed as business ...