How to calculate indexed cost of acquisition in india
Indexed Cost of Acquisition = (Cost of Acquisition * Cost of the Inflation Index (CII) for the year in which the asset was sold or transferred.)/ The cost of Inflation Index (CII) for the year in which the asset was first held by the assessee OR FY 2001-02, whichever is later. Capital Gain = Sales Consideration – Indexed Cost of Acquisition Once the Cost Inflation Index is applied to the cost of acquisition, it becomes an indexed cost of acquisition. If you are selling a capital asset after 2 years of its purchase, the gains will be considered as Long-Term Capital Gains. For an asset purchased in 2002 for Rs. 10,000 and sold in 2014, the inflation-indexed cost price will be calculated as: (Rs 10,000 *(240 / 105)) = Rs 22,857(Approx.) The revised index will be applicable for calculating indexed capital gains for any asset sold in the financial year 2017-18 and onwards. The cost of acquisition shall be the value of the property as on 1.04.01 which shall be then indexed. Get the valuation done from a registered valuer. LTCG shall be the sales consideration as reduced by the indexed COA calculated above and the indexed cost of improvement (construction). How to Calculate Indexed Cost of Acquisition & Improvement Posted on August 1, 2013 August 8, 2013 by Finhealth This provision deals with section 48, defines as the amt which bears cost of acquisition, the same ratio as cost inflation index for the year in which asset is transferred bears cost inflation index for first year in which asset was Formula for computing indexed cost is (Index for the year of sale/ Index in the year of acquisition) x cost. For example, if a property purchased in 1991-92 for Rs 20 lakh were to be sold in A.Y. 2009 -10 for Rs 80 lakh, indexed cost = (582/199) x 20 = Rs 58.49 lakh.
In India the year for financial transactions start from 1 st April and ends on For long-term capital gains, indexed cost of acquisition and indexed cost of You can use our Capital Gain Calculator to calculate Short and Long term capital gains.
The cost of acquisition/improvement will, thus, be indexed with reference the rate of The Cost of Inflation Index is mainly used to compute Long term capital gain. The cost inflation index (CII) are fixed by Government of India in its official How to calculate Period of Holding? (vi) In the case of a capital asset being shared in an Indian company, which becomes the property of the assessee in ( 2) The indexed cost of acquisition and indexed cost of any improvement thereto. 13 Sep 2019 Cost inflation index chart and table to calculate capital gain tax on sale of property. after deducting the indexed cost of acquisition from the sale value. Corporation (REC) or National Highways Authority of India (NHAI). 20 May 2016 In indexation and capital gain terminology, the adjusted purchase price is called ' indexed cost of acquisition'. Indexation Benefit in Debt Mutual 30 Dec 2019 For long term capital gains all the deductions are indexed using CII (Cost Inflation Index) published annually by Government of India. Also Read: Tax on gold: short term, long term and calculation. Income Tax Act of India specifies that profit from sale of gold bars, jewelry, coins or utensils or any Indexed cost of acquisition is higher than the actual cost of acquisition and hence , capital 22 Aug 2018 Calculation of indexation benefit for assets that are gifted and sold later has long been a contentious issue between the income-tax department
So, you should first calculate the indexed cost of acquisition by applying CII on the cost of purchase, i.e., 25 lakh. You can find the CII values on www.incometaxindia.gov.in. In the example, CII
Indexed Cost of Acquisition = (Cost of Acquisition * Cost of the Inflation Index (CII) for the year in which the asset was sold or transferred.)/ The cost of Inflation Index (CII) for the year in which the asset was first held by the assessee OR FY 2001-02, whichever is later. Capital Gain = Sales Consideration – Indexed Cost of Acquisition Once the Cost Inflation Index is applied to the cost of acquisition, it becomes an indexed cost of acquisition. If you are selling a capital asset after 2 years of its purchase, the gains will be considered as Long-Term Capital Gains. For an asset purchased in 2002 for Rs. 10,000 and sold in 2014, the inflation-indexed cost price will be calculated as: (Rs 10,000 *(240 / 105)) = Rs 22,857(Approx.) The revised index will be applicable for calculating indexed capital gains for any asset sold in the financial year 2017-18 and onwards. The cost of acquisition shall be the value of the property as on 1.04.01 which shall be then indexed. Get the valuation done from a registered valuer. LTCG shall be the sales consideration as reduced by the indexed COA calculated above and the indexed cost of improvement (construction). How to Calculate Indexed Cost of Acquisition & Improvement Posted on August 1, 2013 August 8, 2013 by Finhealth This provision deals with section 48, defines as the amt which bears cost of acquisition, the same ratio as cost inflation index for the year in which asset is transferred bears cost inflation index for first year in which asset was Formula for computing indexed cost is (Index for the year of sale/ Index in the year of acquisition) x cost. For example, if a property purchased in 1991-92 for Rs 20 lakh were to be sold in A.Y. 2009 -10 for Rs 80 lakh, indexed cost = (582/199) x 20 = Rs 58.49 lakh.
13 Sep 2019 Cost inflation index chart and table to calculate capital gain tax on sale of property. after deducting the indexed cost of acquisition from the sale value. Corporation (REC) or National Highways Authority of India (NHAI).
1) first you need to calculate the cost of acquisition & improvement so for plot, you need to take the prince as on 1981 and then index it for construction, you need to take the cost and index it take total cost & divide by 5 to get your cost of acquisition You can then calculate the Capital gain amount. 2) yes,
The cost of acquisition shall be the value of the property as on 1.04.01 which shall be then indexed. Get the valuation done from a registered valuer. LTCG shall be the sales consideration as reduced by the indexed COA calculated above and the indexed cost of improvement (construction).
30 Jun 2018 Cost inflation index numbers are used for calculating taxpayers while calculating capital gains tax payable on the assets acquired on or before 1981. PM Modi to address nation today, next 15 days crucial to India's battle 30 Jun 2018 Cost inflation index numbers are used for calculating while calculating capital gains tax payable on the assets acquired on or before 1981. 20 May 2015 So, you should first calculate the indexed cost of acquisition by applying CII you must reinvest the amount in one residential property in India. 6 Aug 2019 CII number is used to compute the inflation-adjusted purchase cost of calculating capital gains tax payable on assets acquired on or before
12 Jun 2014 Cost Inflation is required to calculate Long term capital gain under Income Tax Act Where, Indexed cost of acquisition =Cost of acquisition x CII of year following amendment in the notification of the Government of India in 1 Nov 2012 Is the cost basis based on an inflation index, or the cost-and-sold prices to pay capital gain tax? In India, the inflation factor is taken into account to The formula to calculate the cost inflation index is as follows: Cost Inflation Index (CII) = CII for the year the asset was transferred or sold / CII for the year the asset was acquired or bought Suppose, you purchased an apartment for Rs.20 lakhs in Jan 2000 and sold it for Rs.35 lakhs in Jan 2009.