Income Tax Question: Does the value of assets remain the same on return forms from previous year?

[jas9]

Does the value of assets remain the same on the return forms (wealth statement) from previous year?

Suppose, you purchased a plot for 1 million. You put it on your tax return forms last year. Now, this year, surely the price has appreciated of that plot. Are you still going to write 1 million value of the plot or you need to find out the market value and put that there? If it's the latter, how do I find out the exact value? I won't know the exact value until I have a buyer ready to buy at a certain price.

In other words, are we supposed to update the value only after disposal of the asset? In that case, I can keep putting 1 million value of this plot on my return forms year after year until I sell it and then report that realised gain. Is that right?

[Nabs]

You put exactly the same amount as previous year (at the price you bought/made first entry), keep repeating every year until you sell it. When you sell the asset, you show the difference as profit in the tax year you sell it in.

In case of real estate, there is no tax on profit if you sell it after 4 years.

[jas9]

Thank you. This clears it up.

Another Q. Suppose, your father bought a property in 2016. He 'gifts' it to you in 2018. You sell it in 2020. Now, that 4 year period after which there is no tax. Do you count that from 2016 (originally bought) or 2018 (transferred to you as gift)?

[Nabs]

As per my knowledge, it doesn't matter if its a gift or a purchase. The time starts when the real estate is transferred to you. But you should confirm this as I am not 100% sure about this.

[capsat]

the time period is calculated from date it appears under your name/ cnic at govt records.
gift or purchase it does not matter.