Adjustment of normal income from L.T.C.G.

773 views 2 replies

shivam

student

25 Points Posted on 29 January 2012

Dear Experts,

If someone has sold any residential house in PY:10-11 and

say long term capital gain arising from it is 4Lakhs,

and he has deposited the same in Capital Gain A/c .

Now in PY11-12,

he has withdrawn the same, but his normal income for PY:11-12

is nil (i.e.,: 0),

can he clain deduction of his normal income(i.e., of 160000) from the

above carry forward Long term capital gain?

Do Reply

Thanks in advance

Shivam

Replies (2)

Bhushan Ramani

Chartered Accountant

105 Points Posted on 30 January 2012

As per the set off rule ... the point here the basic exempyion limit must be set off against the normal income and then excess of exemption limit must be set off against the LCTG. Although, in PY 11-12, if the normal income is NIL. u can set off ur LTCG against the basic exemption limit upto 160000.

Regards,

Bhushan Ramani

meenakshi

Head - Finance

56 Points Posted on 29 February 2012

I have a related query on this topic.

Total income is defined as Gross total income less deductions under Chapter VI A for income from salaries.

Now if total income is equal to 100000 and the same is set off against investement as per Chapter VI A to the full extent of 100000, then income from salary becomes nil.

Then if Long term capital gains amounts to 2,50,000 for a senior citizen, can the entire amount of LTCG be set off against the basic exemption limit?

An early answer will be appreciated.

Sumati