Capital gain
This query is : Resolved
Querist : Anonymous
Querist :
Anonymous
(Querist)
18 February 2014
Whether interest on borrowed capital to purchase property is allowable expenditure against the income from Short term capital gain
18 February 2014
1. Interest on borrowed capital is allowable as deduction u/s 24 while computing income from house property.
If there is no income, deduction will result in loss which can be set off against other income.
2. Deduction of interest is NOT allowed while computing capital gain. Deduction is allowed only for cost of acquisition & cost of improvement.
Interest cost is neither of the above.
If there is no income, deduction will result in loss which can be set off against other income.
2. Deduction of interest is NOT allowed while computing capital gain. Deduction is allowed only for cost of acquisition & cost of improvement.
Interest cost is neither of the above.
Querist : Anonymous
Querist :
Anonymous
(Querist)
20 February 2014
but sir, we had taken unsecured loans to purchase that properties and on the sale of the said properties, we had claim interest expenditure while computing STCG.....
whether this interest cost is allowable or not?????
whether this interest cost is allowable or not?????
20 February 2014
Interest cost is NOT allowable as deduction while computing capital gain.
Section 48 prescribes the manner of computation of capital gain:
Capital gain is to be computed as under:
Sale Consideration
Less: Cost of acquisition
Less: Cost of improvement
Cost of acquisition is defined in Section 55. Interest cost is NOT included in cost of acquisition.
Section 48 prescribes the manner of computation of capital gain:
Capital gain is to be computed as under:
Sale Consideration
Less: Cost of acquisition
Less: Cost of improvement
Cost of acquisition is defined in Section 55. Interest cost is NOT included in cost of acquisition.
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