08 September 2013
A Pearson sold a property for Rs 60lac which was inherited to him from mother, He decides to invest Rs. 35lac in buying other house and other 25 lac to send to his brother.
Q1)Long Term Capital Gain will charged on the whole or only 25lac?
Q2)And how much will be the tax rate ?
Q3)Is the index Slab and Date of acquisition applicable here ?
Q4)Any other suggestion to save the Capital Gain Tax ?
09 September 2013
First u need cost of acquisition.of property my mother Now index that value Deduct indexd. Value frrom sale figure remaining is capital gain It could be more than 20 lac or less depending upon cost of property. Now invest only the amount of gain in another house. U are free to use remaining amt. Out of sale. Whole the tax can be saved this way. Though tax rate is 20% in case of such capital gain if amount not invested within prescribed time.
Applicability: This exemption can be availed only by individuals or HUF. Kind of asset: Residential house property or land appertained thereto.
Nature of the asset: The house property is a long term capital asset.
Investments: To be invested in residential house property or deposited in a bank a/c under the Capital gain account scheme.
Amount to be invested: Capital gains
Time limit: Residential house property to be purchased within 1 year before the date of such transfer or within 2 years after the date of transfer OR residential house must be constructed within 3 years after the date of transfer.
Lock In period: The new house property that is acquired should not be sold within 3 years. In case if the property is sold within 3 years then the amount of capital gains that was exempted earlier and the capital gains accruing on the sale of the asset both, will be taxed in the year of receipt of consideration.
Section 54EC
Applicability: This exemption can be availed by anyone.
Kind of asset: Any capital asset
Nature of the asset: The capital asset must be long term.
Investments: To be invested in specified long term capital bonds. Specified long term capital bonds which are redeemable after 3 years are as follows:
Issued on or after April 1st 2000 by REC or by NHAI
Amount to be invested: Capital gains Time limit: Within 6 months from the date of such transfer
Lock In period: If the specified assets are transferred or converted into money within a period of 3 years then the capital gain arising on the transfer and the earlier exempted capital gain will be clubbed and taxed in the year of the receipt of the consideration
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