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Long term capital gains computation

Tax queries 339 views 1 replies

vijay kumar

CA Job

24 Points Posted on 19 August 2015

I have made a sale of listed equity shares to a friend not routed through a stock exchange without paying STT. Can I pay the long term capital gains tax at a concessional rate of 10% (and not @ 20% as we usually pay while taking the indexation benefit) without availing the indexation benefit if this is beneficial to me?

Note: I have other incomes that exceed the basic exemption limit.

The following are further details:

I have sold 7600 listed equity shares belonging to a public Ltd company @ 68Rs (Cost of acquisition being Rs10 and alloted to me in the year 2005 which converts the shares into long term capital assets) directly to a friend without routing it through a stock exchange in the year 2014 and thereby did not pay the STT. I have a doubt regarding the Capital Gains computation here:

Shld I pay 44080 ie (7600*58)*10% without taking the indexation benefit OR

Shld I pay 72042 (516800-156587)*20% after taking indexation benefit

Thanks,
Vijay

Replies (1)

Yash

Student CS

32 Points Posted on 20 August 2015

Section 54
Exemption for residential house

LTCG(Long term capital gain) on transfer of residential house shall be exempt if the amt. of capital Gains is utilised for purchase/construction of new residential house within the following time limit.

TIME LIMIT
The new house should be purchased within 1 year before the date of transfer or 2 years after date of transfer or it should be constructed within 3 years of transfer.
SCHEME OF DEPOSIT
If the new asset is not acquired upto the due date of filing return then the assessee should deposit the desired amount in a special account opened in accordance with capital Gains accounts Scheme, 1988.
The deposit amt. is not utilised then the exemption allowed shall be withdrawn.

AMT OF EXEMPTION
1) Amt. of only Long term Capital Gains
2) Cost of New Asset/Amt. deposited
LOCK IN PERIOD
The new asset should not be transferred within 3 years from the date of its purchase. If the new asset is transferred within 3 years then the exemption will be withdrawn.

ELIGIBLE ASSESSEE
Individuals & HUF
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