Harsha (Software professional) (214 Points)
04 March 2015Dear Experts,
A query on LTCG on residential property (plot). I understand that with indexation, rate of tax is 20% and flat rate of 10% without indexation.
In many very old properties, the sale price and the profits are almost same (the purchase price was less at that time). So I feel that going without indexation would be a far better option.
Could you please clarify?
Regards,
Harsha Vardhana R
Swami Ayyappa Nuli
(TAX ADVISOR & CONSULTANT AT G.S.T SUVIDHA CENTER)
(1372 Points)
Replied 05 March 2015
The Benifit of With Indexation @ 20% or With out Indexation @ 10% is available only in case of Longterm capital asset being Shares on which such transaction doesnot subject to Security Transaction Tax. Hence you can not go for computation of capital gain on sale of Residential property without Indexation @ 10%
Harsha
(Software professional)
(214 Points)
Replied 05 March 2015
Dear Nuli,
Thanks for the clarification. Now I understand that for property, it is always better to apply indexation. That would save some money.
Regards,
Harsha Vardhana R
Arif Ali
(Apt Co Advisory)
(1230 Points)
Replied 05 March 2015
Hi Sarsha,
you can invest u/s 54EC in specified bonds issued by REC & NHAI upto 50 lac and also invest u/s 54F in residentail house property.
CAclubindia
