Selling Pre-Marriage Land? Routing Proceeds to Spouse May Not Save Tax
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Moneycontrol•20-01-2026, 06:52
Selling Pre-Marriage Land? Routing Proceeds to Spouse May Not Save Tax
- •Capital gains tax is determined by property ownership, not by where sale proceeds are routed.
- •A woman selling land bought pre-marriage in her sole name cannot automatically split tax liability by routing proceeds to her husband.
- •The entire capital gain will be attributable to the actual owner (the woman) and must be reported in her ITR.
- •To legally split proceeds and tax liability, a gift deed transferring a portion of the property to the spouse must be executed and registered before the sale.
- •Even with a gift deed, clubbing provisions might apply, making the capital gains taxable in the original owner's hands, though the spouse can still claim Section 54F exemption.
Why It Matters: Routing pre-marriage land sale proceeds to a spouse does not automatically shift tax burden; ownership dictates tax liability.
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