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Capital gains for a private ltd company

vt2rbi (self) (59 Points)

03 June 2017

My Company is a pvt ltd company having only 2 directors with only 1 asset . I am planning to sell that asset , which is a residential apartment. Can companies save capital gains by reinvesting in some capital gains schemes or is there any way we can reduce the tax liability

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11 Replies

Venu Gopal (28 Points)
Replied 04 June 2017

yes you can get section 54 exemption

vt2rbi (self) (59 Points)
Replied 05 June 2017

Dear Sir,

Thank you so much for your revert. so if i have procured the flat at 77 lacs and selling it at 5 crores how much will be be my tax liability.

In Anticipation

Studentsca (CA Practice ) (3577 Points)
Replied 05 June 2017

More information will be required i.e
date of purchase,
whether depreciation has been claimed.?
date of sale
stamp duty valuation ,
Agreement value.

vt2rbi (self) (59 Points)
Replied 05 June 2017

date of purchase 2002

purchase value is 77 lacs

Yes depreciation is being claimed .

property market value if sold today is 5.5 cr. and is not yet sold.

If sold today approximately what will be the tax percentage on capital gains?( is it 20% or 30%) and can we get some relief by investing in bonds etc as in the case of individuals.

With Thanks....

sanjivan pal (11 Points)
Replied 10 June 2017

Capital gain will be calculated as,
Sale value or Stamp Duty value (Higher)
less: (77lakhs-depreciation, i.e, wdv)
=Capital Gain before exemptions
less:(maximum 50 lakhs exemption for investing in NHAI OR RECL Bonds or some specific secuirites within six months of sale)
=taxable capital gain

Tax rates will be as per long term capital gain which will be 20% of capital gain. Also, cess of 3% on previously calculated tax is to be paid..
Thus effective rate of tax is 20+3%=20.6%

1 Like

vt2rbi (self) (59 Points)
Replied 15 June 2017

Many Thanks, once again.

What will be the long term capital gains tax , if the depreciation is being claimed. For the company, Will it be 20.6% or flat 30 %?

With Regards/

sanjivan pal (11 Points)
Replied 15 June 2017

20.6%

vt2rbi (self) (59 Points)
Replied 17 June 2017

Many thanks, Mr. Pal

RAJA P M ("Do the Right Thing...!!!") (127142 Points)
Replied 17 June 2017

Very Nice Explain Mr. Sanjivan Pal...
Thanks for the Details...

sanjivan pal (11 Points)
Replied 17 June 2017

😊 Its my pleasure..

vt2rbi (self) (59 Points)
Replied 17 June 2017

Dear Mr.Pal, Many thanks for your inputs and advise. In the above case is it better to sell the asset viz ..apartment or is it better to sell the entire company. As it is a single asset company to minimise tax outgo at the hands of the Individual Directors. With Regards,