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House Acquisition Cost for capital gains purpose

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Income@tax1

Project Manager

21 Points Posted on 14 July 2023

I have bought a plot in bangalore and constructed house in 2003. Now I am planning to sell the property.

For calculating Capital gains, for land I have government value in a registered document.

I am looking at how to arrive at my acquisition cost of the building.

Will approved evaluator report of cost of building at time of acquisition is accepted by income tax?

I don't have any bills for the house constructed.

Thanks

Replies (2)

Quick Summary

When selling a property purchased and built some time ago, determining the acquisition cost for capital gains tax is crucial. While land value might be clear from registered documents, establishing the building's cost without original bills can be challenging. This discussion explores whether an approved evaluator's report is accepted by income tax and outlines key considerations like indexation, holding periods, and potential tax exemptions.

Dhirajlal Rambhia

SEO Sai Gr. Hosp.

121543 Points Posted on 15 July 2023

Though it would be questionable without the proof of any payments by bank, but it is a sort of options available in the act.

Aashok Kumar Sharma

Finance/Compliance Consultant

75648 Points Posted on 08 November 2026

Plot bought, house built in 2003, now selling:
• Cost of acquisition: plot cost (year of purchase) plus construction cost (2003) as cost of improvement or construction. Each indexed from its year (if opting for indexation).
• Holding period: from the plot purchase (land) and from construction completion (building). If both exceed 24 months, LTCG.
• Sales after 23 July 2024: residents choose the lower of 12.5% without indexation and 20% with indexation. If the plot was bought before 2001, use FMV as on 1 April 2001 (capped at SDV then).
• Exemptions: Sec 54 (new house), 54EC bonds.