Cap of Rs50 lakh applies on LTCG re-invested in specified bonds under section 54EC5 min read . Updated: 12 Feb 2018, 05:17 PM IST
You can claim an exemption from tax by re-investing the LTCG in specified bonds notified by the central government within 6 months from the sale of the property
I purchased a 200 sq.mt residential plot in Varanasi from Varanasi Aam Bima Karmachari Sahakari Avas Samiti Ltd in May 1994 for Rs21,420. Since it was an undeveloped and unleveled plot, in the same financial year, I spent Rs25,000 towards land filling, erection of boundary wall and an iron gate for entrance. I spent another Rs5,000 for putting a hand pump and boring. In December 2017, I sold it for Rs28 lakh against a circle rate value of Rs35 lakh (stamp duty paid on Rs35 lakh). What will be the index cost of acquisition and whether cost incurred as above on improvement and construction on the plot will qualify for inclusion as acquisition cost? How will the long-term capital gains be calculated? Is brokerage deductible from sale proceeds? Also, I intend to invest Rs6-8 lakh in LTCG bonds in May 2018. Can I do that and also whether in such a case capital gains tax can be spread across two financial years? Or do I have to account for it in this FY2017-2018? I am a senior citizen. Also, please note that for above expenses on development and construction, no bills or vouchers are held as these petty jobs were done by casual labourers.