Help with LTCG

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Chandrika Subramaniyan (Querist)
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17 October 2010 I would be grateful for your help on LTCG Caluclations so that I can decide upon the avenue of Investments for the sale amount recieved. I give below the data required for calculations. My Tax slab till Mar 2010 has been Zero. Flat and Sale city is chennai

Purchase of Flat by Father (Land 11000/Constr 45000 )66000
Year of Purchase - Nov1975
Year of Transfer to my name by partition Deed - July1993
Vlaue of Flat Assesed on Transfer 520000
Sale Price 5200000
Year of Sale 2010
No of Years 17
Purchase CII 1981-1982-100
Purchase CII 1993-1994-244
Sale CII 2009- 2010-632 (2010-11 shd be known in Mar 2011)
Indexed Purchase Price ?
Capital Gains ?
Tax with Index ?
Tax without Index ?

Thanks
Chandrika

Bhaskaran Chackrapani Warrier

Bhaskaran Chackrapani Warrier (Expert)
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17 October 2010 1. Cost can be taken as the fair market value of the property as on 1/4/1981 by virtue of section 55(2)(b)(ii) of the Income tax Act,1961. For this a valuation as on 1/4/1981 may be obtained from an approved valuer. Let me assume the FMV as on 1/4/1981 as per the above said valuation is10,00,000/-
2. Indexed cost is10,00,000/- X 632 / 244 =25,90,164/-
3. Capital gains =52,00,000/- minus25,90,164/- = 26,09,836/-
4.Tax without indexation is not permitted by law.
5. Income tax @ 20 % and cess and secondary and higher education cess @ 3% on tax =5,37,626/-

N.B:- If you do not have any income other than capital gains basic exemption can be deducted from capital gains before arriving the income tax as calculated above.

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