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Will I get indexation benefit on LTCG tax for plot inherited in 2003?

Mihir

Mihir Tanna  |946 Answers  |Ask -

Tax Expert - Answered on Jul 26, 2024

Mihir Ashok Tanna, who works with a well-known chartered accountancy firm in Mumbai, has more than 15 years of experience in direct taxation.
He handles various kinds of matters related to direct tax such as PAN/ TAN application; compliance including ITR, TDS return filing; issuance/ filing of statutory forms like Form 15CB, Form 61A, etc; application u/s 10(46); application for condonation of delay; application for lower/ nil TDS certificate; transfer pricing and study report; advisory/ opinion on direct tax matters; handling various income-tax notices; compounding application on show cause for TDS default; verification of books for TDS/ TCS/ equalisation levy compliance; application for pending income-tax demand and refund; charitable trust taxation and compliance; income-tax scrutiny and CIT(A) for all types of taxpayers including individuals, firms, LLPs, corporates, trusts, non-resident individuals and companies.
He regularly represents clients before the income tax authorities including the commissioner of income tax (appeal).... more
Asked by Anonymous - Jul 26, 2024Hindi
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Sir I inherited a plot of land in 2003, which was purchased by my father in 1995. I am planning to sell the plot. My question is whether I will get indexation benefit on LTCG tax or not?

Ans: No, In the Budget Proposal Indexation benefit is removed for property transferred from 23rd July 2024. However, cost of acquition for calculation of capital gain can be FMV as on 1.4.2001 or stamp duty value as on 1.4.2001 (whichever is lower)
DISCLAIMER: The content of this post by the expert is the personal view of the rediffGURU. Users are advised to pursue the information provided by the rediffGURU only as a source of information to be as a point of reference and to rely on their own judgement when making a decision.
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Ramalingam

Ramalingam Kalirajan  |6568 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Aug 09, 2024

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I did sale agreement for my flat on 6 may 2024 but sale deed registration was done on 28 July 2024, will i get the indexation benefit in LTCG.
Ans: The Indian Budget 2024 introduced significant changes to the taxation of Long Term Capital Gains (LTCG) on property:

Removal of indexation benefit: This was the initial proposal.
Option to choose: Due to widespread criticism, the government later allowed taxpayers to choose between a 12.5% tax rate without indexation or a 20% tax rate with indexation.  
Key Factors for Your Case
Date of Sale Deed Registration: This is generally considered the date of sale for tax purposes. In your case, it's July 28, 2024.
Option to Choose: Since your sale deed registration is after July 23, 2024 (when the budget changes were announced), you have the option to choose between the 12.5% tax rate without indexation or the 20% tax rate with indexation.
Considerations and Recommendations
Consult a Tax Professional: Due to the complexity of the situation and potential tax implications, it's strongly recommended to consult a tax professional or chartered accountant. They can provide tailored advice based on your specific circumstances.
Analyze Both Options: Calculate the tax liability under both options (12.5% without indexation and 20% with indexation) to determine the most beneficial choice for you.
Consider Other Factors: Factors like the holding period of the property, the purchase price, and other expenses might also influence your decision.
Note: The sale agreement date (May 6, 2024) might not have a direct impact on the tax calculation in this case.

By carefully considering these factors and seeking professional advice, you can make an informed decision and optimize your tax liability.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

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Nayagam P P  |3811 Answers  |Ask -

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Sir the median package at ssnce for cse core is less than rvce ise .So does it make more viable option considering placement in mind .I have a dream of becoming software engineer from my childhood. But my seniors are advising for rvce ise.what to do should I follow my dream or placement.I am a Bangalore resident and Tamil is my mother tongue.
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