Long term capital gain indexed cost of acquisition
Many of us face the problem of calculation of capital gain on sale of property which was towards long term capital gain arising on the sale of the residential flat no. As regards the third issue regarding indexed cost of acquisition, Ld. CIT (A) For long-term capital gains, indexed cost of acquisition and indexed cost of improvement is deducted instead of cost of acquisition and cost of improvement. 28 Jun 2019 You can use the indexation method to calculate the capital gain on an asset acquired before 11.45am (by legal time in the ACT) on 21 September 1999, in an element of the cost base (other than those in the third element, Long-term capital gain which arises on the transfer of a long-term capital asset. Short-term capital gain Indexed cost of acquisition of the asset;. Indexed cost of 14 Dec 2016 Calculate the indexed cost of acquisition. To arrive at this figure, multiply the purchase price and improvement cost by the Cost Inflation Index (CII)
If the new asset is sold within 3 years of its purchase or construction then for calculating capital gain, the cost of acquisition of new asset shall be taken as zero (0). When Cost of New Land or Building (new asset) is equal to or more than Capital Gain
Now the indexed cost of acquisition will be as per the above formula i.e. Indexed Cost of Acquisition=(Rs.50 lakh/117)*272=Rs.1,16,23,931. So the Long Term Capital Gain=Selling Price-Indexed Cost of buying property=Rs.33,76,069. (Note-As per the below Cost of Inflation Index (CII), the CII rate for FY 2017-18 is 272 and for FY 2005-06, it is 117). 1) Please clarify, to save tax on long term capital gain, investing in purchase of another house property the amount, equal to total amount of sale proceeds less (a) cost of acquisition and (b) cost of improvement of the capital asset transferred, is sufficient. The Income Tax department recognizes this and issues an annual Cost Inflation Index (CII) that allows you to index your cost of acquisition to take inflation into account. This indexed cost is then used to calculate your long term capital gains and the resultant tax on same. Cost Inflation index also called Capital gain index is used to calculate the indexed cost of acquisition for long-term capital gain tax. The indexation table Cost Inflation index also called Capital gain index used to calculate the indexed cost of acquisition for long-term capital gain tax.
Computation of Long Term Capital gain: While computing Long term Capital Gain , indexation is done for the cost of acquisition and improvement. Cost Inflation
For the purpose of computing long term capital gains, the property seller has to calculate the indexed cost of purchasing the property. To assess the indexed cost, the seller needs to multiply the property's cost of acquisition with the cost inflation index, as notified by the tax authorities for the year of transfer. This figure then has to be divided by the cost inflation index of the year of purchase. Now the indexed cost of acquisition will be as per the above formula i.e. Indexed Cost of Acquisition=(Rs.50 lakh/117)*272=Rs.1,16,23,931. So the Long Term Capital Gain=Selling Price-Indexed Cost of buying property=Rs.33,76,069. (Note-As per the below Cost of Inflation Index (CII), the CII rate for FY 2017-18 is 272 and for FY 2005-06, it is 117). 1) Please clarify, to save tax on long term capital gain, investing in purchase of another house property the amount, equal to total amount of sale proceeds less (a) cost of acquisition and (b) cost of improvement of the capital asset transferred, is sufficient. The Income Tax department recognizes this and issues an annual Cost Inflation Index (CII) that allows you to index your cost of acquisition to take inflation into account. This indexed cost is then used to calculate your long term capital gains and the resultant tax on same. Cost Inflation index also called Capital gain index is used to calculate the indexed cost of acquisition for long-term capital gain tax. The indexation table Cost Inflation index also called Capital gain index used to calculate the indexed cost of acquisition for long-term capital gain tax. Now the indexed cost of acquisition will be as per above formula i.e. Indexed Cost of Acquisition= (Rs.50 lakh/117)*272=Rs.1,16,23,931. So the Long Term Capital Gain=Selling Price-Indexed Cost of buying property=Rs.33,76,069. (Note-As per the below Cost of Inflation Index (CII), the CII rate for FY 2017-18 is 272 and for FY 2005-06, it is 117).
'Indexed cost of acquisition'' means an amount which bears to the cost of acquisition the same proportion as Cost Inflation Index for the year in which the asset is
9 Mar 2020 Cost Inflation index also called Capital gain index is used to calculate the indexed cost of acquisition for long-term capital gain tax. Read this 5 Feb 2020 Indexed cost of acquisition = Cost of acquisition * Cost Inflation Index (CII) of the year in which the asset is transferred / Cost inflation index (CII) of 7 Jan 2020 Long-term capital gain = Sale price – (indexed cost of acquisition + indexed cost of improvement + cost of transfer). Indexed cost = Cost 6 Aug 2019 The Finance Ministry has notified 280 as the cost inflation index (CII) be used to compute inflation adjusted long-term capital gains (LTCG) on calculating capital gains tax payable on assets acquired on or before 1981. 13 Sep 2019 The cost inflation index (CII) for the financial year (FY) 2019-20 has been It is important to compute the long-term capital gains/long-term capital calculating LTCG/LTCL tax payable on assets acquired on or before 1981. 6 Jan 2020 Capital gains or loss is calculated as the difference between the sale consideration ( ₹25 lakh) and the indexed cost of acquisition (ICOA).In case for more than ₹30 lakh, will I have to pay long-term capital gains (LTCG) tax?
If the new asset is sold within 3 years of its purchase or construction then for calculating capital gain, the cost of acquisition of new asset shall be taken as zero (0). When Cost of New Land or Building (new asset) is equal to or more than Capital Gain
25 Jan 2011 Indexed Cost of Acquisition = (Actual cost of purchase) * (CII Of Year of Sale)/(CII of Year of Purchase). Capital Gain = (Sale Price MINUS Indexed 7 May 2018 Until financial year 2017-18, Long Term Capital Gain (LTCG) tax on equity or tax of 10% (without indexation) on gains made above ₹1,00,000 per The cost of acquisition of share or unit bought before 1st February 2018
In case the Asset sold / transferred is a residential house, and if out of the capital gains, a new residential house is constructed within 3 years, or purchased 1 year before or 2 years after the date of transfer, then exemption on Long Term Capital Gain is available on the amount of investment in the new asset to the extent of the capital gains. Cost Inflation index also called Capital gain index is used to calculate the indexed cost of acquisition for long-term capital gain tax. Read this article to know more about the cost inflation index who notifies it with practical examples Long term Capital gains after Indexation = Sales consideration - Indexed cost of acquisition Taxes = 20% * Long term capital gains after indexation The current base year for CII is FY 2001-02 and the CII value starts at 100 for that year.