Capital gains

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Sai Karthik (Querist)
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02 July 2014 Hiiiiiiiii all,

I am a member of Mysore bank cooperative society from 1969-2011.When i was member i was allotted a site in 1970 with possession certificate.But i have registered the same in 1988 for a consideration of 4500/-.In 2012 i have constructed apartments on the same.And in 2013 i have sold my flat for a consideration of 30Lacks.

And for that construction purpose i incurred 20 Lacs.

As land was aquired before three years it is long term,and building constructed in 2012 it is short term.Am i right?

If it was right,how to separate land and building values?

Please clarify?

R SUGUMARAN

R SUGUMARAN (Expert)
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03 July 2014 Income Tax Act permits separate treatment of capital gains for the disposal of plot and the apartment.

Accordingly for the sale consideration of land you can take long term capital gain exemption subject to fulfilment of conditions stipulated.

For the short term capital gain on the sale of apartment you should pay tax.

R SUGUMARAN

R SUGUMARAN (Expert)
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03 July 2014 For the land value, you can take the market value of the adjacent lands and deduct the same from the total consideration to arrive at the building value. However, the building value cannot be less than the prevalent market value in the nearby vicinity.

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Sai Karthik

Sai Karthik (Querist)
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04 July 2014 Thank you.
Is it enough if we value land and building?

or else we have to be take valuer report for segregating consideration?

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