Capital gain on sale of ind. Land building

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This discussion addresses the capital gains tax implications for an individual selling industrial land and a building. The calculation involves determining the cost of acquisition for both assets, considering indexation for the land and the Written Down Value (WDV) for the building, which may be negligible if constructed in 2008-09. A valuation report is recommended to ascertain the building's short-term gain, with the remaining sale proceeds attributed to the land for long-term capital gains calculation after indexation.

Prakash Maroo

Prakash Maroo (Querist)

18 August 2023 An assessee filing ITR on Presumptive Income basis sold industrial land and building for 40 lakhs during ay 23-24. Land was purchased for 3 lakh during financial year 2008-09 and building was constructed during financial year for Rs. 15 lakhs. Please suggest basis of capital gain considering indexation and depreciation issue.

Dhirajlal Rambhia online

Dhirajlal Rambhia online

(Expert)

18 August 2023 What is the WDV of building?

Prakash Maroo

Prakash Maroo (Querist)

18 August 2023 Building was constructed during financial year 2008-2009 hence it's WDV is about to nil.

Dhirajlal Rambhia online

Dhirajlal Rambhia online

(Expert)

18 August 2023 Get valuation report of the building, that will be your short term gain of building.
Remaining part from sell value will be sell price of the land. Gain after deducting indexed cost of land will be LTCG.

Dhirajlal Rambhia online

Dhirajlal Rambhia online

(Expert)

10 September 2024 Good Luck.

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