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    capital gain (1)

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    12 views33 pages

    Capital Gain

    Uploaded by

    sakshi chauhan

    Copyright:

    © All Rights Reserved
    Download as PDF or read online from Scribd
    Flag for inappropriate content
    of 33
    Any profit and gain arising from Transfer of a Capital Asset shall be chargeable under the head capital gain in the P.Y. inwhich transfer took place # | Section 2(14); Definition of Capital Asset Capital Asset means- of any kind held byassessee, whether or not connected with business or Issee or his dependent family member Sculpture, Archaeological Collection Pe tre Bel) ec Reset eR u/s 10(15) Consider as Personal Effec' Benarshilal Kataruka) Brecious metal or any all isil or other ar 6. | Definitionof Urban Area a) any area (municipality, cantonment board etc) which has a population of 10000 or More b) inthe following area within the distance measured cerially shortest distance from | populationaccording areareferred in point (a) | to last census Population 10K Or More taken or retained in part shares ina Co r enabling the Asset (LTCA) RC Certara Any Other ange in Indi Eta OL ry aay Ppose of capital gain. pital g hen we d within 2 years 's. Capital gain on land is (b) er Sera fion 48:2 dexation T__ Second proviso (exception) 12 ih +), cOA& 0| should be indexed : set), in case of LTCA (long term capital 95 ICOA COA X Cll for the yoo" of a gos a hich asset wa: Cll for the first year in WI year 2001-02, whichever is later aE ¢ transfer ran COI Xx Cll for the year ° Cll for the year in which the improvement to the asset took place Cost Inflation Index (cI) cil BY. CII Fg cu ‘ 01-02 100 04-05 113 07-08 129 10-11 167 13-14 220 16-17 264 19-20 289 Asset acquired before 1/4 COA = Actual cost or FMV improvement done before: First proviso to section 4 In case of - -Assessee who is a Non -Asset should be shar Such asset was acqui then capital gain shi be reconverted in’ iS, units of Busine lon transfe foreign cu ‘against of Indian com ideration os (ETT) 1et Allowed sete under capital goin S51 poid on sale/ 1 | Incose of : Goce of - abusiness of PrOFESS.on ‘Trademark or Brand na son tings trate icture, produce, Proc au sor Prof & copyright), Right to manufot Right to carry on any Busines Tenancy right Loom hours. Route permits Cost of Acquisition es 1. Benefi 2. Capital gain on transfer of self generated trade mark/ brand nom to tax up to the AY 20-21 tof FMV as on 01/04/2{ 3. In case of goodwill of a business 32(1) has been obtained by the acquisition of such goodwill would) the total amount of depreciation Bonus Shares / Security oC Tf acquired before 01/04/2004 then FVM as 1 (Added by FA 20, v (00,000. FMY as on 01.04.2001 is ON aco done before 01/04 eption Of Section 45(1) rT SS hn scraanwnichitig converted cont oa FMV itory referred to in clause (via) of sect wg capital gain COA of such asset shall be FMV Referreg For the purpose of computine 6 in section 28(via) # | Section 2(424): Period of Holding OH Shall be reckoned from the date Example : Yatish trading company. 14/05/2020 as stock in trade. SIT nai is 22 per share. Inventory of 10 10/07/2021 and FMV on such date is 0n19/03/2022 © 45 each 4 balance 8, Compute PGBP and Capital Gain, Solution Computation of PGBP Particular Opening stock | Aas Purchase of Stock Less: sale Closing Stock (10,000 x 20) (Cost-20 or NRV-22, Lower) PGBP (2,000) under any Low acquisition mon compulsory ACI arse sonata DSSS ne yeor Sia i the year # | Section 45(9) Com [Normally capital gain of capital asset, copital 2 of compulsory cca, roxedinsheyeor be taxable in goinwill rice Gel oe Fyvoc (Enkanced Compensation) rx (Jeomeor STCG/LTCE *% n Expenses (xx pensation received in respect of ny awarg » orified that _compensati y ee m levy of income-tax vide section 96 Of the inband: Acquistion. Rehabilitation o. agreement which has been exempted from Right to Fair Comp: Resettlement Act, 2013 (RFCTLARR) shal sation and Tronspane My Guampled on agricul # | If compensation received in instalment ap ¥ Tt willbe toxable in the year in which isn Tfany enhanced compensation is received) compensation shall not b which taxable in the is passed by such court, Notes Any interest received on receipt 4 50% de If late compensati duction will be allowed uf compensation is reduced by any court give effect of the same (Sec. 155) af £} a Normally capital gain is taye4 f° aie) 9 'S10Xed in the vers oe Desh asset, Capital gain be tag pT ransten e Caa Where capital asset is deg Me Yearinwhicg en RSE Of destruction of cop ; destroyed duc nich ef cap then capi. : and Ae shall aris «)|_ computation o llerise | FVOC [insurance claim Money Ey ap (COA /TCOA sset receivedas claim)) aay (08) Looe) = \ Bent for development of project. th sal gain on pl be taxable in the year in which Bject issued by Competent Authority sansfer his share in project on or before Haxable in the year in which transfer took “ent (IDA). serng ond or Bullding oF Both gg, { 7 specified Agree a ~ aaeeares et in ‘on such land or build | mins oregiere degree og estate Pree ding or bl ding Sones er pron sree ST, peng 2 a er ceeiaration IME te ch | sideration 2 project: Part of the com | | / ae /2018 he entered in Example:t 10 inp 01-02. 0n16/07/2 Ts jot for €5,00.0 randover the posse: IDA, BB cs 4 | ie napus onot pet 1 Builder on 16/07/2018, Fy with Omar Builders: flats in developed re.” ive 2 istorece! Indate is €32,00,000. AS Per lot on such date is& 200000 red money of €40,00,000 10 FY 20-2. Conley, 72021 & SD on such date is €50,00,009 pute Capital Gai pk ‘along with €40,00,000. Mr ‘certificate (CC) of project issued on 10/12: flat, Mr, BB got possessionof 2 flats on 30/0 Solution | MR. BB Computation Copital Gain FVOC(50Lacs x2 Flats) 40Lacs] Less: ICOA [POHO1-02 to 15/7/2018) 5,00,000 x 280(18-19) 100(01-02) Example: 2 Suppose inabove example if Mi 14/02/2023. Compute capital gain | Solution MR. BB | Computation Capital Gain | Fvoc Less: COA [POH 30/06/22 to 13/02/23) oat Less than SDV of arp valuation author 4 | J FVOC- Value ascertaineg FVOG-SdVoF stempouthority by valuation of ficer (V.0) “s considered but u/s 50C if date date of i of “SDV considered on da nfoke SDV on the dete Normally ‘agreement & registration are N if he received consideration oF Par ic clearing sys then assessee Ca! i thereof upto the date of agreement i # agreement i em through a bank account oF aq Ale payee cheque/ DD, use of electroni ether electronic modes asmay be prescribed onic modes - Notification 8/202 # | Otherelec (@) Credit Ca (&) Debit Cord (©) Net Banking: (@) IMPS (Immediate Payment Service), (©) UPL (Unified Payment Interface): (f) RTGS (Real Time Gross Settlement) (@) NEFT (National Electronic Funds Transf (h) BHIM (Bharat Interface for Money) Aad Note # quoted share" means the share quoted Teatlrity from tine to time, where the q h i Tansaction made in the ordinary course of "eunder the headin tion 508: Slump sale Insideration undertaking) pt (monetary * no {BAD was Claimed) jg wa 3 Ju which ded a incase of NR Copital gain ne ainincase of — Fajr Oriented cata sunitsot business = bond First proves Sec. 48 Sec.48 ‘Capital Fourth proviso to Sec. 48 sec. 112A Listed equity Shares, Equ! f ansaction not regardes cempt transfer) .das Transfer ( section 47: Certain TH Following transactions are not regarded as trans fl 1. | Distribution of capital asset on the partial or tot Transfer of capital asset under gift, wl ‘Note: This clause shall not apply to transfer und debenture or warrants allotted by company to é As per sixth proviso to section 48 FMV on til irrevocable rust) shall be treated as FVOC off 3._| Transfer under by amelgamat amalgamated Co. is Sec. 47(vi) 445) Transfer of capital asset by halding Co. to it holding Co. provided following conditions are sat 4) Holding Co. holds 100% shareholding of subsi b) Transferee Co, should be Indian Co. “)_ | Cost of acquisition Sec. 49 1): Cost of acquisitigl 5) | Costof improvement incurred by previous own elding:POH of previous owner shall mereclCOst oF Acquisition Manjula.t Sha ¢) | Period of h scheme of demer =aring Co. 0 30h Merge ed Co. 10 Fes by deer i) A cansfer of copitl 058 sec. 47 0) i 1 Co. will nop, ded yo the hands of such shareholders sy - na sranarecot shores of 09 prides a me vated Bond af an Enaion Comp ara) Sie 7 Gent sey (ar Py, sro a nermediory delng ment of interest) made 10] Trnsfer of @ by 1c 47 (vib) ” Se .d by RBI under Sovereign Gold Bond Scheme feet spn ork of a Fomefer ofa capital asset being ony work Tecton, Book, mruserpt raving, patil a ‘sity, national museum, national art gallery, Mm notfiedintitution: See 47() debentures / deposit ced 13, | Conversion of bonds / share of that Co, Sec. 47(X) debentures received on cori i) COA of share debenture / bond /deb stock / deposit certificd ii) POH of shares or debentures shall also include: tock/ deposit certificate held by assessee. 4, oes eRe Re aT Notes: ') COA of Equity shares received on conversion st Shares, which is so converted Sec. 49(2AE) i) POHof Equity shares shall also include the pen assessee Sec. 2(42A) 15.| Transfer ‘5, | Transfer of capital asset ina transaction of Revel notified by central govt) Sec. 47(xvi) > Any amoun ny amount) eeeeted by Senior citizen und Individual ca ft transferred from the date ition of new as d by exempted Trvestment in certain bg ib ; [section 54EC) 3h "Compt Bonds redeemable after i fate of transfer. Syears issued, by (0) Notional Highway 2 yrs prion to ‘authority. of India on land or buildings for tha ra New industrial undertaking constructed Time limit of Within 3 years from date | purchased or receipt of compensation | constructed | 6. Deposit scheme Applicable [7 Amount of | @eapital gain [exemption (2) CNA/deposit amt | 8. Tran new asset is transferred assets provisions 3yrs from date of purcha construction then cost of acquisition of new asset reduced by exempted : ring ne ition under any law, the ih Tim for ect 3 ! Fension of time al Section AH: Extensions Ty compulsO™Y °C «gal be COMPUTE from qa j -e tronsfer of copital 0: eating ea : iH i woes 5 mmpulsory acquis! i racing renee af af receipt of compensation 4 \ds/ units, he sho mn BAEC hal ; te security of bon 7 h loan or advance is tog. mn or advance on Thi 'e date onwhich such oe ‘ted into money on thé re be taxable, “capital gain exempted earlier shall capital gain exempted earlier sh ve then Assessee con acquire Two Res! lential house properties; tore then Assessee can 5. | IFLTC6 is upto 2 Cr it of 2 HP is availab! sbed time limit. This benef fe only once in life time. (Added by FA 2019 w.e f.AY 20-21) 10(37): Exemption of capital gan in case} of Urb L1C6/s following condition are satisfied a) Assessee should be are individual / HUF 6) Such agricultural land should be used for agri of transfer by assessee or his parents ) Considerations determined or approved by RB Tax Rates for Capital Gain LTC6 on transfer of equity shares, or equity oriented units, or Units of Business Trust im excess of 100,000 shall be ta ()__STT Paid on acquis Cii)__STT Paig able @ 10% if ion & transfer of equ on transfer of equity Oriented ‘Example: From following inr * Ta} GaP ip s y da IFO! ; \ I be # \ ken a) TAX ONLTCG © 10% jn $) Taxon balance NTz 190,000 : would be tax Bae le at concession \ inst Capital Gain referred taxable u/s 112A where condition of 2004 eligible for benefit of sec 112A 19/2004 eligible for benefit of sec or unit of Business Trusy ypd or ui i riented ful anit of eau? 7272018, COA shall = a ecuired before 1/2 ty shar Incase of e@ : Jin gection 124 069 Capital Gain a ing information Compute |_ Example: zi cost. Fav. Selling Price on 10/12/2021 Computation of Capital Gain Fvoc Tronsfer exps Net consideration (COA (wn-1) L706 u/s 112A WN COADRE Sa ase [Sagi 0 Sap ae Coat | @) | a) FMVon 31/01/2018 + b)Fvoc capital gain w/s liza | io Listed shares/Units on recognised stock exq "MV = Highes} ale Y= Highest price Quoted on 31/01/2018 Zero Coupon Bond rom Unlisted s 2A ree 1 | TEE ome (other than LTCG ws i

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