New Delhi: If you are selling a property, for example a residential flat before March 31, 2025, then you will have to pay capital gains tax in the form of advance tax by the last day of the current month. In this article, let’s understand how the tax will be structured.
If an individual sells property in the upcoming financial year, i.e., 2025-26, then let’s see how the seller would pay the advance tax.
Capital gains tax and advance tax rules
If a person (below 60 years of age) is selling a flat in March 2025 and its payment will be made in installments – For example, the first installment will be received in March 2024-25, the second installment after the change of financial year i.e. in April 2025-26, then advance tax rules will be applicable on the individual.
Property sale: What is the rule for advance tax payment
If the tax liability in a financial year is more than Rs 10,000, then it is mandatory for the taxpayer to pay advance tax. Let’s see when does it have to be paid:
By 15 June: Up to 15% payment
By 15 September: Up to 45% payment
By 15 December: Up to 75% payment
By 15 March: 100% payment
Capital gains tax is required to be paid in the same financial year in which the property is transferred, even if the payment is received later.
Date of property transfer
There is no clear rule as to when the property needs to be transferred when the selling is done. There are different rules in parts of the country related to the date of transfer – Some consider the date of agreement as the date of transfer, some record the date of sale deed, some consider the date of registration and some the date of handing over the actual possession of the property.
Deadline for paying advance tax
If the official date recorded for the transfer of property is March 15, 2025, then the advance tax will have to be paid by March 15 in 2024-25 itself.
If the sale takes place between March 16 and March 31, 2025, then the entire advance tax will have to be paid by March 31, 2025.
If the official records state that the property is transferred in FY 2025-26, then capital gains tax will also have to be paid as per the advance tax schedule of FY 2025-26.
What will happen if the tax is not paid on time? If the advance tax is not paid by March 31, 2025, then a penalty may be imposed on it.
Selling a property before March 31st, 2025, triggers advance tax obligations. This article clarifies the capital gains tax and advance tax rules for property sales in 2025-26. It details the payment schedule (15% by June 15th, 45% by September 15th, 75% by December 15th, and 100% by March 15th) and the implications of late payment. Personal Finance Business News – Personal Finance News, Share Market News, BSE/NSE News, Stock Exchange News Today
