Capital Gains Tax of Property
All Lahore Real Estate clients are requested to not pay too much attention to this “NEW” 10% Capital Gains Tax on Property in next budget. No need to be scared at all.
Every one is saying on TV Media and social media that this is a “NEW” tax is actually very ill informed. Nothing NEW here.
Already you pay 10% capital gains tax if you sell a property within 1 year. Already you pay capital gains tax at rate of 5% if selling a property after 1 year hold but before 2nd years ends.
After 2 years you was to pay ZERO capital gains tax on property profits.
“NEW” in this current budget is that they “CHANGED” time limit and made it a FIXED rate of 10% for any part of 5 years now. If you sell property any time in next 5 years. If you dont sell it for 5 years. You pay ZERO capital gains tax.
Also many people are scaring other people in LRE WhatsApp groups that if you make 1 crore Govt will get your 10 lacs. Its not the case. You will be taxed on DC rate of property for 10%. Regardless of at what rate you bought or sold. If you want to be good you can declare actual profit but I bet you most people in Pakistan are not that good in paying full amounts including people who are passing budget.
Any time you will sell this property during next 5 year you will just pay 10% of DC value at time of sale.
I am not a tax expert but I though I need to calm few people before they dump their plots before July 1st 2016 . If you held your property for less that 1 year there is ZERO change for you in case of Capital gains of property. You was to pay 10% any way even before budget announcement.
I have many refrence to prove my point but posting only one here. Please read it carefully.
Yes CVT and WHT are increasing too plus all this negative miss information being spread in media about this NEW capital gains tax etc are likely to keep market slow for next few months ( Told you about it in great detail in my market direction 2 hours WhatsApp audio for May 2016) But balloon or bubble not bursting any time soon. It will be getting bigger in next 3 to 4 years due to dizzying numbers of MEGA projects are going on Lahore real estate market as we speak. And next year is a year before election so even more of these mega projects will be coming in picture soon like Badian road expansion etc
Please share in each LRE or other group you are already a member to spread the word.
Choudry Mujahid Yasin ( CMY )
+16308024186 SMS or Text To get yourself/friends/relatives added to LRE WhatsApp groups
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