Hello,
I have purchased a land & now if i make construction of 2 floor on the same so when i will sell the property so at that time
whether it will be treated as cost of improvement for computation of capital gains.
2 Replies
CA Rajnik Galani
(prctice)
(154 Points)
Replied 04 June 2013
Dear friend,
If u made any improvement in fixed asset than it allowed as a improvement cost.
If u construction additional floor than it allowed as improvement cost.
Swami Ayyappa Nuli
(TAX ADVISOR & CONSULTANT AT G.S.T SUVIDHA CENTER)
(1372 Points)
Replied 04 June 2013
when u sell the property u need to distinguish between land and building as building is depreciable asset and land is not.here u cant treat construction of 2 floor building as cost of improvement to land.u need to divide ur consideration between land and building.further no indexation will be available to building.so if u deduct such cost as cost of improvement along with indexation,how it department will let u do it
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