Hi everyone,
I wanted to know what would be the entry for the following: Land purchased at 40 lakhs and sold for 90 lakhs in the same year. Expenses related to land was 10 lakns. I assume that Short Term Capital Gain is 40 laks. How do I record these entries in Tally? Are the following correct:
Property(Fixed Asset) 40L DR
To Bank A/c 40L CR (Being Property purchased)
=========================================
Property Expense(Fixed Asset) 10L DR
To Bank A/c 10L CR (Being Expenses On Property)
=========================================
Property 10L DR
To Property Expense(Fixed Asset)10L CR ----- Journal Entry (Expense transfered to property as it should not affect personal business income / expense)
=========================================
STCG 40L DR ----- Should STCG fall under indirect income? However if so it affects personal business income
To Property 40L CR
=========================================
After these entries how does STCG affect the income tax statement? If it is shown in the P+L statement, will it not be added in the income tax statement as INCOME FROM CAPITAL GAINS? And if it is added does it not mean its double entry as it is included in profit and again in income? Please confirm as i am very confused.
Thank you
CAclubindia
