Capital Gain in partnership firm

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This discussion addresses capital gains tax for a partnership firm selling an office purchased in 1988. The initial calculation suggests no capital gains tax due to indexation, as the sale value is less than the indexed cost. However, the firm has claimed depreciation, which complicates the calculation, potentially leading to short-term capital gains tax.

Girish Limbachiya

Girish Limbachiya (Querist)

02 July 2022 Dear Sir,
we have purchase one office in 1st August 1988 for Rs.318500 in the name of Partnership firm . We are getting Rs. 1,60,00,000 if we should sale it
Market value in August 2001 was Rs. 9245000.
what would be capital gain tax ?
If we should build new building or purchase new office would cost around Rs. 1500000 in partnership firm, can we save capital gain tax ?

Thanks
Girish

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)

02 July 2022 The present capital gains index is 331.
Apply this index on 92,45,000 the indexed cost is 3.06 crore so capital gains tax will not arise as sale value less than indexed cost.

Girish Limbachiya

Girish Limbachiya (Querist)

05 July 2022 Dear Sir
Thanks for your reply.
we are getting rent on this assets and also we have claimed depreciation on this assets. still it will fall under long term capital gain we sale it ? and we should do indexing while calculating capital gain tax ?

Please advice us .

Thanks
Girish

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)

05 July 2022 In such a case it will be short term capital gains pay taxes no exemption.

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