Long term capital gain tax

An Income Tax Practioner/CA is the beat person to assist you in the matter.

In case of long-term capital gain, capital gain = final sale price - (transfer cost + indexed acquisition cost + indexed house improvement cost).

To calculate the long-term capital gains accurately, follow the steps mentioned below:

Step 1: Determine the Full value of consideration

Step 2: Determine the Net value of Consideration

Step 3: Calculate the Cost of Acquisition 

The formula for calculating the indexed cost of acquisition is:

Indexed cost of acquisition = Cost of acquisition x (CII of the year of transfer / CII of the year of acquisition)

Step 4: Deduct exemptions under section 54/54B/54D/54EC/54F

Step 5: Long-Term Capital Gains chargeable to tax:

The long-term capital gains chargeable to tax formula is:

LTCG chargeable to tax = Net sale consideration - Cost of Acquisition - Cost of Improvement - Exemptions under Section 54/54B/54D/54EC/54F.

Consult tax lawyer ..

To calculate Long-Term Capital Gains (LTCG) tax, follow these steps:

Determine the Full Value of Consideration Sale price: ₹10,50,000

Calculate Indexed Cost of Acquisition Since you acquired the property in 2017, the cost of acquisition is ₹9,40,000.

Indexation benefit applies if the sale occurred before July 23, 2024. Indexed cost = Cost of acquisition × (CII of sale year / CII of acquisition year).

 However, indexation benefits were removed for transfers made after July 23, 2024.

Compute LTCG LTCG = Sale price - Indexed cost of acquisition If indexation is not applicable, LTCG = ₹10,50,000 - ₹9,40,000 = ₹1,10,000.

 Apply LTCG Tax Rate LTCG tax rate is 12.5% for all capital assets. Tax payable = ₹1,10,000 × 12.5% = ₹13,750. Check for Exemptions You may claim exemptions under Sections 54, 54B, 54D, 54EC, or 54F if applicable

When you acquire a property due to family partition it is not an acquisition for the purpose of capital gain. So market value on that date will not be considered for the purpose of computation of capital gain. For properties acquired very long ago Government would have fixed a date for the computation of capital gain. You consult a chartered accountant specialising in income-tax and pay him his fees.