LTCG (with indexation)
Mrs. X brought a house (plot) measuring 84 sq mtr in 1997/98 for Rs.700,000.
In 2005, she built Floors 3 Floors (Floor 1, 2,3) …. Lets say she spent 500,000 on these floors but do not have any receipts, however current house tax include the new floors built.
She is now a senior citizen and has 2 sons, Y and Z and wants to sell that house and distribute the money equally among her sons.
Actual price – 700,000 (1998)
Sold in FY 21-22 for Rs.2,50,00,000 (2.50 crore)
indexation of Acquisition
= (700,000*(317/100)) (Actual price*(current CII/CII for 1998)
= 700,000 * 3.17
= 2,21,90,000
|
Full Value |
25,000,000 |
|
Less : Commission/ Brokerage (1%) |
250,000 |
|
Net Value |
24,750,000 |
|
Less : Indexed cost of acquisition |
22,190,000 |
|
Less : Indexed cost of improvement |
To check if applicable |
|
Exemptions u/s 54 |
To check if applicable |
|
LTCG applicable on Amount |
2,560,000 |
My queries as below:
- Can she avail Indexed cost of improvement?
- Any exemption u/s 54, or 54EC or 54F.
- If she distribute money among her sons, any tax liability for sons?
- No LTCG if that amount is used by her sons for buying the property within 6 months
- Do Buyer need to pay TDS – 1% on value or can it be avoided.
CAclubindia
