Capital gain

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This query is : Resolved

manisha (Querist)

16 February 2018 Hi

I bought a land in the year 2000 and constructed some commercial building over it amounting 10 lakhs. Same has been capitalised in Business books.As land is non depreciable and building is depreciable. Building is coming under block with other buildings. Now i sold the same land & building for Rs 42Lakhs. How it will be treated in Capital gain head.

Any tax saving over this?

Arpit

Arpit (Expert)

16 February 2018 Manisha - you should go for apportionment of sale consideration

- Gain arising on Transfer of Land will be treated as Long Term.
- Lower Rate of Tax i:e 20%
- Benefit of Indexation will be available
- Gain on Land can be claimed exempt u/s 54EC &/or 54F
- Gain on Sale of Building will be treated as Short Term & no benefit of indexation will be available

This tax planning is only possible if your business is in the capacity of Individual or HUF

manisha

manisha (Querist)

19 February 2018 In general there is no distribution of amount in registry for land and building.

How do i apportion its sales consideration?

Arpit

Arpit (Expert)

19 February 2018 you can go thru section 50C, 43CA for the procedure of distribution.

you can drop an email at arpit012018@gmail.com for further clarification

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