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LTCG on flat

28 April 2025

I bought an apartment on 5th Nov 2008 in Hyd for around 8 lakhs and sold it for 25 lakhs on 17th March 2025 !

What is the LTCG , is it with indexation or without indexation calculation, I am little bit confused ! Please help me out as I am going to pay file soon ! Thanks and Regards!

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4 Replies

Gautam Bothra (Chartered Accountant) (46 Points)
Replied 28 April 2025

Hi Assuming the gain accrues to you as individual and you are Resident (not NRI) in the year 2024-25

Your LTCG will be lower of the following:

12.5% without indexation
20% with indexation

For calculation of Gains and tax without indexation simply reduce sale price with cost of acqusition: INR 25 Lakh - INR 8 Lakhs = INR 17 Lakhs. Tax @ 12.5% is INR 2.125 Lakhs

For Calculation of Gains and Tax with indexation it is as follows

Sale proceeds: INR 25 Lakhs

Indexed Cost of acqusition - 363/137 X 8 Lakhs = 21 Lakhs

Capital gains with Indexed cost: INR 25 Lakhs - INR 21 Lakhs = INR 4 Lakhs

Tax on above @ 20% - INR 80,000

Option 2 is better for you.

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Raghu Shrm (15 Points)
Replied 29 April 2025

But my CA is saying as I sold it on 17 th March 2025 after July 2024 , indexation is not applicable, can I have any reference of it in the Income tax Act page no or document to support! Thanks and Regards

Gautam Bothra (Chartered Accountant) (46 Points)
Replied 29 April 2025

Your CA is right with respect to calculation of capital gains however the tax incidence is limited to lower of both. See below citation where tax is lower of current provision or as per earlier provision.

Please refer to 2nd proviso to Sec 112(1)(ii)

"Provided further that in the case of transfer of a long-term capital asset, being land or building or both, which is acquired before the 23rd day of July, 2024, where the income-tax computed under item (B) exceeds the income-tax computed in accordance with the provisions of this Act, as they stood immediately before their amendment by the Finance (No. 2) Act, 2024, such excess shall be ignored;

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