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Cost of acquisition query regards house

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Udgam Koomar

Tax Technologist

1949 Points Posted on 30 July 2013

Hello, I had applied for allotment of land in Noida through lotterry thru application money in 1998, I got the allotment and started paying the installment yearly, in 2004 I got the plot possession, then I constructed the house in it in 2006 and then sold it of in 2012. Question is:

(a) To calculate LTCG, what will be the year of acquisition, 1998 or 2004?

(b) I fully paid in 2004 so What will be the cost of acquisition, the amount finally paid till 20044 or initial money in 1998 if the answer to above question is 1998.

Replies (2)

Mihir

Wealth Manager

5293 Points Posted on 30 July 2013

There will be two cost of acquisition viz cost of acquisition of the land and cost of acquisition of the building. Allotment is a right to own and possess the property. But when you have already in possession at the time of sale, then the date of possession shall be taken and not the date of right to possess.

Sale consideration: value as on 2012

Less Indexed cost of acquisition of land - 2004

Less Indexed cost of acquisition of building - 2006

Less cost of improvement if any

Less Expenses for transfer

Total long term capital gain

Capital gain @ 20.36%

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