Bonjour, new guests from small-town India
Puneet Dhawan of Accor is brimming with ideas on ways to revive the hospitality sector
I was allotted a house by Mysore Urban Development Authority for which ₹3.30 lakh was paid in 4 instalments for the period from the year 1991 to 1993. The house was handed over in the year 1998 when an expenditure of about ₹4 lakh was incurred towards repairs and renovation. In the years 2013 and 2014, I constructed first floor incurring expenditure of about ₹45 lakh. The house is now sold for ₹120 lakh in December, 2020. Since the Cost Inflation Index (CII) is available only from the Financial Year 2001-02, how should the capital gain is to be calculated for the purchase cost of ₹7.30 lakh incurred during the years from 1991 to 1998.
K R NATARAJ
Gains arising from the sale of a capital asset is taxable under the head “capital gains”. Given the fact that the house property was held for over two years, any gain arising from sale of this property will be regarded as long term capital gain and will be subject to tax at the special rate of 20 per cent (exclusive of surcharge and cess). The following factors should be considered while working out the long term capital gains:
a. As the property was acquired before April 1, 2001, you have an option to consider either the actual price or the fair market value (FMV) as on April 1, 2001 as the “Cost of acquisition”. With effect from April 1, 2020, the FMV, shall not exceed the stamp duty value of the property as on that date April 1, 2001.
b. Any improvements that were done to the property after April 1, 2001 can also be considered as cost of acquisition;
c. Cost of acquisition determined above shall be adjusted by applying appropriate cost indexation index.
Assuming the FMV on April 1, 2001 to be ₹7,30,000, your long-term capital gains will be computed as under:
Under specified sections viz. section 54EC, section 54, etc., deduction/exemption under the Act could be claimed by way of either investing LTCG in the prescribed bonds or in buying a residential property in India, subject to prescribed conditions.
Puneet Dhawan of Accor is brimming with ideas on ways to revive the hospitality sector
Citroen’s first vehicle sports a novel design and European interiors. It is also meant to be as comfortable as ...
The pandemic is only the tip of the iceberg that the country’s cash-poor airlines — both regional and national ...
The government is yet to specify the framework of its recently announced old vehicle scrappage policy
This Women’s Day, we discuss the features of a few financial products that aim to help you save, get insured ...
Sensex, Nifty 50 make a strong bounce-back, but test resistances
Avenue Supermarts (₹3,286.1): Makes fresh all-time highIn October last year, the stock of Avenue Supermarts ...
The exchange-traded fund ticks all boxes as an efficient tool to track gold prices
Muriel has put our names down on a list to get the Covid-19 vaccination because — hurrah! — the age limit has ...
They are the health warriors who battled the Covid-19 pandemic on the ground, and are now the face of the ...
Uzbekistan’s grandest city dazzles tourists with its history, architecture and food
It’s the birth anniversary of Michelangelo di Lodovico Buonarroti Simoni, one of the great artists and ...
Comfort, convenience, value, safety — and not necessarily the colour pink — but do brands deliver?
Why and how marketers have used camels, and left us thirsting for more
Start-up SALT wants to break feminine stereotypes around money, and is asking women to reassert agency
It’s that time of year again when brands suddenly start paying obeisance to women power. From sentimental to ...
Three years after its inception, compliance with GST procedures remains a headache for exporters, job workers ...
Corporate social responsibility (CSR) initiatives of companies are altering the prospects for wooden toys of ...
Aequs Aerospace to create space for large-scale manufacture of toys at Koppal
And it has every reason to smile. Covid-19 has triggered a consumer shift towards branded products as ...
Please Email the Editor