—Personal, NRI & HNI Advisory
Property Transaction Tax Advisory
Capital gains, TDS on property purchase / sale, exemptions and documentation.
Handled by a practising Chartered Accountant or Company Secretary.
Scope of work
Capital gains, TDS on property purchase / sale, exemptions and documentation.
Key deliverables
- Advisory note and computation
Governing law
Income-tax Act (1961 / 2025, as applicable to the period)
Frequency
As required
REGISTRATION ONLY
Property Transaction Tax Advisory
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- Advisory note and computation
REGISTRATION + COMPLIANCE CARE
Property Transaction Tax Advisory + Compliance Care
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+ ₹9,599/yr for year-one ROC compliance
- Advisory note and computation
- Financial statements in Schedule III format
- Board report and AGM notice
- Filed AOC-4 with SRN
- Filed MGT-7 / MGT-7A with SRN
- Board and AGM minutes
500+
Companies incorporated
100%
CA/CS-signed filings
4.8/5
Founder rating
—A closer look
Understanding property transaction tax
Everything below is written for property buyers and sellers — the tax on property sales, TDS and stamp duty rules, exemptions for reinvestment, and how to plan a transaction.
What is property transaction tax advisory?
Buying or selling property in India involves several taxes and rules: capital gains tax for the seller, TDS for the buyer, stamp duty and registration charges, market value rules that can override the agreed price, and GST on under-construction property.
Advice before the transaction helps sellers reduce tax through exemptions and timing, and helps buyers meet their TDS obligations and avoid tax on buying below market value.
The key terms
What buyers and sellers need to know:
- Long-term capital gains
- Property held over 24 months; taxed at 12.5% without indexation since July 2024, with a choice for resident individuals and HUFs on property bought before then.
- Stamp duty value
- The government's value for the property. If it's more than 110% of the price, it can replace the price for both seller and buyer tax.
- TDS on purchase
- Buyers deduct 1% TDS when buying from a resident for ₹50 lakh or more; for NRI sellers, TDS applies at capital gains rates.
- Reinvestment exemptions
- Gains can be exempt if reinvested in a residential house or specified bonds, within limits.
- Capital Gains Account Scheme
- A bank deposit scheme to park gains until reinvestment, to keep the exemption.
- GST
- Applies to under-construction property bought from builders, not to completed property or resale.
- Joint ownership
- Each co-owner is taxed on their share of the gain.
A simple example
A Hyderabad couple sell a flat they bought jointly in 2012 for ₹1.6 crore. Because they're resident individuals and bought before July 2024, they compare tax at 20% with indexation against 12.5% without, and pick the lower. They plan to buy a larger flat within two years, so they claim the reinvestment exemption, depositing the unused gain in a Capital Gains Account Scheme before the return due date. The buyer deducts 1% TDS and files Form 26QB. The registered value matches the government's market value, so no adjustment applies.
Why it matters
Property transactions are closely tracked:
- Large amounts
- Capital gains on property are often the largest tax most families pay.
- Exemptions have deadlines
- Missing reinvestment or deposit timelines loses the exemption.
- Market value rules
- Selling below market value creates tax for both sides.
- Buyer TDS
- Buyers who don't deduct TDS face interest and penalties.
- NRI sellers
- TDS on the full price can lock up large amounts.
- Reporting
- Registries report transactions to the tax department.
- Rule changes
- The 2024 changes altered rates and indexation.
Who is this for?
- Individuals selling a home, plot or commercial property
- Buyers purchasing property, especially from NRIs
- NRIs buying or selling property in India
- Families dividing inherited property
- Landowners in joint development agreements
Legal due diligence on title is done by lawyers; we handle the tax and financial side and work alongside them.
Reinvestment exemptions compared
Ways to save capital gains tax on property:
| Aspect | Residential house | Specified bonds | From other assets into a house |
|---|---|---|---|
| Available on | Gain from selling a residential house | Gain from selling land or buildings | Gain from selling any long-term asset other than a house |
| Invest in | A residential house in India | Specified bonds, up to ₹50 lakh | A residential house in India |
| Time limit | Buy within 1 year before or 2 years after; build within 3 years | Within 6 months of sale | Buy within 1 year before or 2 years after; build within 3 years |
| Amount to invest | The gain | The gain | The net sale consideration |
| Cap | ₹10 crore | ₹50 lakh a year | ₹10 crore |
What we'll need from you
- Purchase documents
- Purchase deed, cost and improvement bills.
- Sale agreement
- Draft or signed agreement for sale.
- Market value
- The government's value for the property.
- Ownership details
- Co-owners and their shares.
- Residency
- Residential status of sellers and buyers.
- Reinvestment plans
- Any planned purchase or bond investment.
Pricing depends on the transaction and whether returns and certificates are included.
How we advise on property transactions
Our approach:
- 1
Review
We review ownership, cost and the proposed deal.
- 2
Compute
Capital gains are computed under the options available.
- 3
Plan
Exemptions, timing and structure are planned.
- 4
Handle TDS
Buyer TDS is filed, or lower deduction certificates obtained for NRI sellers.
- 5
Reinvest
Reinvestment and CGAS deposits are tracked.
- 6
Report
The gain is reported in the return, with advance tax where needed.
After the transaction
Follow-through:
- Advance tax
- Pay advance tax on the gain in the right instalment.
- Deposit or reinvest
- Meet reinvestment and CGAS deadlines.
- Hold the new asset
- Selling the new house too soon can reverse the exemption.
- TDS certificates
- Buyers issue Form 16B to sellers.
- Repatriation
- NRI sellers plan repatriation of proceeds.
- Records
- Keep documents for the new property's future sale.
Benefits and responsibilities
Benefits
- The lowest lawful tax on the sale
- Exemptions claimed within deadlines
- TDS handled correctly
- Market value issues addressed
- NRI transactions planned
Responsibilities
- Share documents before signing
- Tell us about co-owners and residency
- Meet reinvestment timelines
- Deduct and deposit TDS on time (buyers)
- Pay advance tax
- Keep records
—FAQ
Questions property owners actually ask us
Resident individuals and HUFs selling property bought before 23 July 2024 can compare 20% with indexation and 12.5% without, and pay the lower. Others pay 12.5% without indexation.