Hi, since you have received the entire consideration and purchase was also done by you, you can show the gains in your ITR itself. There may be a query from the Income Tax department in future regarding sale value shown in ITR of your sons however is not included as gains. In that case, you can justify by quoting your PAN number that entire value is duly taken into account (Chartered Accountant handling your accounts/ITR will be able to do the needful). This should not be an issue since I have seen a couple of such instances in past however this is based on my opinion on the subject (suggest to take help of expert in filing returns to avoid future issues)
Filing IT return when land sold jointly
I purchased 2 kathas of land in the name of self,wife and two minor sons. All the sale deeds were separate for 10 dhurs each. The entire money was paid by me. Now the entire land has been sold out to three different purchasers. My sons are now adult. The executants are as follows:- 1st sale deed(12 dhurs) - my both sons; 2nd sale deed(12 dhurs)- my wife and one of my son; 3rd sale deed(16 dhurs)-all of us(myself,wife and both sons). The entire money has come to my account. All of us have quoted our respective pan no. The total land value as per sale deed is being shown against each pan no. in form 26(as) on IT website. Land value not bifurcated by sub registrar causing multiplicity of land value. Will all the executants will need to file their returns individually or the entire sales proceeds may be shown in my ITR as myself is the receipient of whole amount. If ITR to be filed individually, whether one fourth of the entire sales proceeds should be shown by each executant or the proportionate amount of land value as per sale deed. What will be the impact of third party information showing the full sale value against each PAN causing unnecessary multiplication of amount, although for the entire sale value there are more than one executant. For example, in 3rd sale deed, there are four executants and the total land value is 35 lakh. But, the Sub Registrar has shown the the land value of 35 lakh in the form 26(AS) of each PAN holder which makes the land value to 4x35 lakh which is not proper. Similar is the position with other sale deeds. What should we do for its rectification or whether it will not cause any impact?
Asked 4 years ago in Income Tax
All will have to file the sale deed seperately. Sale value will be shown as per proportionate amount of land value. You should ask for rectification from the registrar. It will cause a mismatch in return of income.
You have unnecessarily created a web of transactions by including name of your wife and sons in the deed when they have not purchased or paid purchase price for the land.
Now there are two available with you:
1. Either show sale in all 4 account as it is being reflected in Form 26AS in all 4 name. If you do that and ITO takes the case for assessment he might question purchase price and if you choose option 2 i.e. showing entire sale in your name then also there might be a question that why have you not shown sale in other 3 persons return.
Best option according to me would be to show entire income in your return as that would be correct but the income is high you can split the amount in all 4 and take the risk.
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Thank you.
Hi
We can assist you in this.
We need a detail discussion please have a phone consultation.
Dear Sir,
Hope you are doing well !
It is advisable to show the same in individual accounts.
Hello,
In my opinion, each owner would be required to declare his share in the sale consideration.
Regards,
CA Hunny Badlani
Hi
Your wife's capital gains shall be clubbed to your hands.
The compliance portal will show the entire value of the property in each PAN. A proper reply needs to be submitted showing respective share of property against each PAN.
It is a detailed query. It is advisable to take a phone consultation for discussion.
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