Documente Academic
Documente Profesional
Documente Cultură
CAPITAL GAINS
$$$$ Income from House Property $$$$ Profits & Gains of Business/Profess. $$$$ Capital Gains (Sec 45) $$$$ Income from Other Sources $$$$
CHARGEABILITY Any profits or Gains arising from the transfer of a Capital Asset during the previous year is Chargeable to Tax under this head of income. That is to Say:-
the previous year. Profit/Gains should have arisen. Such Profit/Gains should be liable for tax.
What are Capital Assets It includes all type of assets Whether movable/immovable, tangible/intangible etc., It excludes the following:-
materials held for business/profession. Personal effects including wearing apparel and furniture. Agricultural Land (Conditions on Situation applies) Certain Specified Gold Bonds Special Bearer Bonds Gold Deposit Bonds
Personal effects should be movable property, it should be held for personal use and it should not be Jewellary, archaeological collections, drawings, paintings, sculptures, or any work of art. Gold and Silver coins and bars used for pooja of deities as a matter of pride or ornamentation are not personal effects. Therefore taxable. Furniture's are of personal use. Therefore not taxable. Foreign Stamp collections not a personal effect. Therefore taxable. Car, Scooter etc., are under personal effects. Therefore exempted. Securities, Loose diamonds, Goats are not personal effects. Therefore taxable.
SHORT TERM
LONG TERM
If the asset is held for More than 36 Months then they are Long Term Capital Assets.
In case of Equity/Preference Shares in a Company, Securities such as Debentures/Government Securities and Units of UTI and Units of Mutual funds and Zero Coupon bonds the term is 12 instead of 36 months.
TAX LIABILITY
To determine the Value of Consideration To deduct expenditure incurred for the transfer To deduct the cost of acquisition. To deduct cost of improvement. To avail exemption u/s 54 B, 54 D, 54 G, and 54 GA. The balance amount is Short Term Capital Gains. Short Term Capital Gains are chargeable to Tax based on SLAB RATES.
To determine the Value of Consideration To deduct expenditure incurred for the transfer. To deduct indexed cost of acquisition To deduct indexed cost of improvement. To avail exemption u/s 54, 54 B,54 D, 54 EC, 54F, 54 G, 54 GA, The balance amount is Long Term Capital Gains. Long Term Capital Gains are chargeable to Tax on Flat Rate i.e 20%
INDEXATION BENEFIT
What is Indexation:-
Indexation is nothing but working out the value of asset based on cost inflation index. Cost inflation index for the year 1981-82 is 100 Cost inflation index for the year 2007-08 is 551.
If an assessee had purchased an asset during the year 81-82 for a sum of Rs.100.00. The same assets value will be 551 if purchased during the year 200708 based on cost inflation index.
Therefore the assessee gets additional benefit by deducting 551 instead of 100.
54
Section
54 B
Section
House Property and Purchasing/Constructing a New Residential House Property. Transfer of Agricultural Land and acquires a new land for agricultural purpose.
Compulsory acquisition of land and
54 D
54 EC
Section
54 F
other than a House Property and investing in Long Term Residential House Property.
Section
54 G
54 GA
in cases of Shifting of industrial undertaking from urban area to any special economic zone
Thanks