We all know how important the property we get from our inheritance is for us. What if you find out that you will also have to pay tax on inherited property? This year, the last date for filing tax returns has been fixed as 31 July 2023. Let us know whether you will also have to pay tax on inherited property or not.
Inheritance tax is levied on any property left by the deceased to his legal heirs. There is no tax payable on inherited property in India. The Government of India abolished this type of tax in 1985. Earlier in the country, under the Wealth Tax Act 1953, the deceased person had to pay a high wealth tax of up to 85 percent of the value of the property.

Property received by way of will is not treated as income under the Income Tax Act, of 1961. If you acquire any property then it will be added as your income. You have to pay tax on that. Suppose you inherit a rented house, you become the owner of that property as the legal heir. In such a situation, it will now be added to your income and you will have to pay tax at the applicable tax rate.
If you get any interest from the bank on your property, then you have to pay tax on it. You can sell an inherited property as soon as you receive it.
In the case of an inherited property, it starts from the date the original owner purchased the property. If a property is sold after holding it for more than two years, the sale proceeds are treated as capital gains. If the property is held for less than 2 years, the sale proceeds are treated as short-term capital gains. Tax is paid accordingly.