Calculation of LTCG

Apply indexation on total cost of acquisition considering cost inflation index of first year of payment of instalment

For detailed discussion you may opt for phone consultation

Dear Sir,

Hope you are doing well.

To calculate the long-term capital gains tax payable, the following formula is to be used:

Long-term capital gain = full value of consideration received or accruing – (indexed cost of acquisition + indexed cost of improvement + cost of transfer), where:

Indexed cost of acquisition = *cost of acquisition x cost inflation index of the year of transfer/cost inflation index of the year of acquisition.

Indexed cost of improvement = cost of improvement x cost inflation index of the year of transfer/cost inflation index of the year of improvement.

*Any payments made before allotment is to be provided indexation from the date of allotment and any payment made after is to be provided benefit of indexation from the date the payment is made.

We may assist you capital gain tax calculation & entire procedure.

It is advisable to take a phone consultation for detailed discussion. 

Dear sir,

As per my knowledge there have been case laws where it has been said that date of purchase for capital gain would be date when you were given possession i.e. allotment letter and hence you can take 2007 as date of purchase and calculate capital gain. Although AO might not agree to it but you can fight.

Hope you find the information helpful, if yes do rate if 5 and provide your valuable feedback for my improvement.

Thank you.

Hi

The indexed cost of acquisition shall be calculated using the cost inflation indices of the respective years of payment.