New Delhi, Aug. 19 -- If you recently sold agricultural land in your hometown, you may be wondering whether the money you received from the sale will be subjected to capital gains tax. The answer depends on factors such as where the parcel of land is located and whether it qualifies as a capital asset.

Even when no capital gains tax is payable, you are still required to report the transaction while filing your income tax return (ITR) for the relevant financial year when the sale happened. Both taxable and tax-free agricultural land sales are reported under different heads of the ITR form.

No, the sale of rural agricultural land is exempt from capital gains tax, meaning if the said agricultural land is located in a village or rural area,...