Ways to calculate ltcg on land sale

Hi,

The "indexation of cost"  for computation of capital gains arising on transfer of a long term capital asset ( land in your case held for more than 36 months) is mandatory in terms of second proviso to section 48 of the Income tax Act 1961

There are certain exclusions to this provision - but they deal with certain specified securities only - section 112

In your case, the indexation would necessarily apply

Regards

Abhimanyu Jhamba, 

CA; LLb

9811803028

Originally posted by : ABHIMANYU JHAMBA
	Hi, The "indexation of cost"  for computation of capital gains arising on transfer of a long term capital asset ( land in your case held for more than 36 months) is mandatory in terms of second proviso to section 48 of the Income tax Act 1961 There are certain exclusions to this provision - but they deal with certain specified securities only - section 112 In your case, the indexation would necessarily apply Regards Abhimanyu Jhamba,  CA; LLb 9811803028

Thanx for the reply. So indexation is a must. But after indexation, will the LTCG be added to yearly income and taxed according to slab, or taxed separately, and what will be the tax

For  Resident Indians long term capital gains calculation of Land, it will be calculated as per section 48 & Indexation will be applied.

Refer Analysis of Section 48 on https://www.exploreincometax.com/Indian-Income-tax-Act-1961/Section-48

Coming to your second doubt of Having option of Indexation.. This option is available under section 112 (But only for Non residents).  If you are a Non resident ,, Even on House Long term capital gains you have this option

https://www.exploreincometax.com/Indian-Income-tax-Act-1961/Section-112

It will be taxed separately @ 20% .