Tax computation

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Parthasarathy (Querist)
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03 March 2012 I am aged 61 years.Have purchased a land in March 2002 for RS.120350 including the stamp duty and sold it for Rs.1680000 in April 2011.From the capital gain I purchased a apartment in Auguest 2011 for Rs.1400000 including registration cost.
Further I got Rs. 62000/- as annuity pension and Rs.76000/- from FD interest for this year 2011-12.

Kindly let me know the tax.I am a retired person without any income.
Regards
Parthasarathy

CA Rahul Bansal

CA Rahul Bansal (Expert)
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04 March 2012 sir
congrats u have no tax liability regarding this.
your tax computation is as under

Income from Annuity Pension : 62000/-
Income from FD Interest : 76000/-
Income from Capital Gain (Long Term): 58230/-

Total :196230/- (including Capital Gain)
and its totally exempt.

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Prakash Kochar

Prakash Kochar (Expert)
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07 March 2012 Above reply is not correct.
Calculation of income will be as under-
Long term Capital gain will be 1458228/- {1680000- (120350x785/426)}
Less : exemption u/s 54 will be
(1458228x1400000/1680000) 1215189/-
Long Term Capital Gain for Tax- 243039/-
(Proportionate capital gain is exempt)
Under the conditions given income for tax will be -
Int. income ----- 76000
Annuity income -- 62000
LTCG as above -- 243039
TOTAL INCOME 381039
Less:basic exempt. 250000
Balance : 131040 will be liable for tax at flat rate of 20%+ edu. cess.
(9850350854)

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Parthasarathy

Parthasarathy (Querist)
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07 March 2012 Very good feedback.Further I would like to know from Mr.Prakash Kochar that the annuity from LIC like Jeevan Suraksha are exempted by Sec10(10A)(iii) or 23AAB.
Regards,
Parthasarathy.
9663548010

Prakash Kochar

Prakash Kochar (Expert)
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07 March 2012
REGARDING JEEVAN SURAKSHA :1. Tax Benefits
Premium paid upto Rs. 10,000 p.a. is exempted from income-tax as per Section 80 CCC. Similarly Commuted Value of 25% received in one lump sum at the start of the pension is also exempted from Income-tax. However, the amount of monthly Pension as and when received is taxable.

Parthasarathy

Parthasarathy (Querist)
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09 March 2012 Dear Mr.Prakash Kochar,
Very good input.Finally I would like know, if I can save Rs.100000 thro' sec 80C and Rs.15000/- through Sec. 80D. my tax liability will come down from your calculated tax of Rs.131040.
Regards,
Parthasarathy

Prakash Kochar

Prakash Kochar (Expert)
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09 March 2012 Your total income inclusive of LTCG is at Rs. 381039/-. Out of this you can not take deduction u/s. sect. 80C, 80D, against Capital Gain. Excluding capital gain your balance income remains at Rs. 138000/-. Out of this you can avail benefit of reduction by investing amount of Rs. 100000/- u/s. 80C, Rs. 20000/- for infrastructure bonds and balance u/d. 80D.
Taxable income under head LTCG will be 243039/-, wherefrom you can claim the expenses if any incurred in relation to sale of property like brokerage etc, if any.
By availing benefits unmder sect. 80C, 80D, and u/s. 80CCF.
(Section 80CCF:additional 20,000/- in addition to limit & invesment of Rs. 100000/-).
In this way you can pull down your tax liability to NIL.

Parthasarathy

Parthasarathy (Querist)
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09 March 2012 Dear Mr.Prakash Kochar,
Wonderful calculation.As per your calculation if I take care of the income other than LTCG ie.138000/- thro'Sec.80. The balance left out LTCG of Rs.243039 is less than the basic exemption of Rs.25000/-As such I need not pay any tax.
Regards,
Parthasarathy

Prakash Kochar

Prakash Kochar (Expert)
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09 March 2012 Correctly noted by you. kochar.prakash@yahoo.com

Parthasarathy

Parthasarathy (Querist)
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09 March 2012 Dear Mr.Prakash Kochar,
Thanks for your excelant feed back/ information and further hats off to your quick responce.
Wishes,
Parthasarathy

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