what is meant by base date for cost of acquisition
1 Answers
Date of possession on the property has to be used in capital gain computation.
Below calculation has to be used to computation of income tax on sale of property.
Purchase Year = A
Purchase Cost = P
Cost Inflation Index (CII) for purchase year = X
Sale Year = B
Selling price = Q
CII for sale year = Y
Indexed Purchase price = P x (Y/X) = R
Long term capital gain = Q - R = S
Income tax on capital gain = S x 20%
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