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agriculture land

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Querist : Anonymous

Querist : Anonymous (Querist)

29 June 2011 respected sir

qus. about agriculture land one farmer purchase land near to 1km from municipality area and land purchase in the year of 2005 of rs. 8.50lacs with documentation exp. and sale target in the year of 2011 after march minimum state government juntri rate valuation is near to 80.00lacs so i want to know what is tax liability in income tax, and what is rate of tax.

CA PARAS BAFNA

CA PARAS BAFNA (Expert)
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29 June 2011 If the land is purchased between 1.4.2005 to 31.3.2006 and sold after 01.04.2011
Long Term Capital Gains on this transaction will be 80- 8.50x 785/497 = 66.57lacs.

Tax liability will be 20% of the amount of gain. However you may deduct 180000/ out of 66,57,000 / and pay tax @ 20%.

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He can save the capital gains tax if he purchases a residential house or invests in Capital Gains Bonds.

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