we sold a residential flat in Nov 2009.please let us know- 1)the LTCG on the same 2)what are the ways for availing tax exemption.We have already deposited the gain proceeds in the Capital gain deposit account without considering the indexation
1 Answers
You can compute long term gains and income tax using following calculations:
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%
Income tax on capital gain can be saved by investing into another residential house property u/s 54 or by investing into capital gain bonds u/s 54EC.
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