When to pay Tax on Sale of Land?

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  1. sujatha

    sujatha New Member

    my friend purchased a land on 11/7/2005 for rs,136080 paid brokeage 35ooo he spent rs 25000 for fencing on the same year. he has sold the land for rs 1965580 on 20/10/2014 brokeage pd rs 19655 how much capital gains tax he should pay and when is the last date.he is not reinvesting the money.
     
  2. gaurav_kumar

    gaurav_kumar Well-Known Member

    Cost of Acquisition = 136080 + 35000 = 171080
    Indexed Cost of Acquisition = 171080 * 1024/497 = 352486
    Indexed Cost of Improvement = 25000*1024/497 = 51509
    Sale Price = 1965580

    Capital Gains = 1965580 - 352486 - 51509 = 1561585
     
  3. gaurav_kumar

    gaurav_kumar Well-Known Member

    He should pay the tax @ 20% of 1561585 = 312317

    This should be paid right away. Any delay in payment of tax will lead to levy of interest @ 1% per month
     
  4. sujatha

    sujatha New Member

    thank you so much sir
     
  5. sujatha

    sujatha New Member

    DOES he have to pay education chess for this tax
     
  6. Yes, Education Cess @2% and SHEC @1% would also be payable on Rs 312317
     
  7. king999maker

    king999maker Active Member

    actually gaurav kumar did not deducted brokerage on sale,
    as Ur sale consideration is 1965580 & brokerage paid is 19655 and net sale consideration is
    1945925 from that we should deduct
    Indexed Cost of Acquisition = 171080 * 1024/497 = 352486
    Indexed Cost of Improvement = 25000*1024/497 = 51509 so
    capital gains is 1541930
    capital gains tax is 1541930*20.6%
    =317640 rounded
     
  8. gaurav_kumar

    gaurav_kumar Well-Known Member

    Thanks for pointing out the error

    I missed it by mistake.

    Thanks for the rectification
     
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