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residental property tax and tax saving

Others 224 views 6 replies
In 1988. I have purchased a residental property of 2000000 rs-/ and I sold the property in the year 2019 for 4000000 rs-/.. So on what amount I am liable to pay tax and how much tax? And on remaining amount I don't want to pay tax I want that amount be invested. How should I?
Replies (6)

First You need to ascertain FMV as on 1 st April 2001.

Ascertain the fair market value as on 1st april 2001...than compute indexed value upto 2019....than as per section 50C compute the value for consideration and calculate the capital gain accordingly
you need to get the market valuation of your property as on Apr2001. then the market valuation or the cost of purchase whichever is higher shall be the cost which needs to be indexed and this amount needs to be deducted from the sale consideration received. the balance amount will be capital gains.this AMT you can invest either in capital gains bonds max up to 50lacs or in a residential property.
agreed with giridhar dir
TREATMENT TO BE DONE AS ABOVE ,, FIR CLARIFYING
ILLUSTRATION-
Mr. Mishra bought a plot of land for Rs.10,00,000 in the year 2005. After 10 years had elapsed, in January 2015, he sold off his land for Rs.30,00,000.

Cost Inflation Index, CII= Index for financial year 2014-15/Index for financial year 2005-2006 = 1024/480 = 2.13

Indexed cost of purchase = CII x Purchase Price = 2.13 x 10,00,000 = 21,30,000

Long-term capital gain = Selling Price – Indexed cost = 30,00,000 – 21,30,000 = Rs.8,70,000

Tax on capital gain = 20% of 8,70,000 = 1,74,000
thank you and congratulations


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