Withdrawl of Interest from Capital Gains Account Scheme

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  1. j m joshi

    j m joshi New Member

    One of my client has sold a house property purchsed for 5.5l in 2004 for 31 lac in 2014 june .
    what would be the tax with indexation...and if invested in CGA and reinvested 12 lacs then what would be the tax.
    Also assume that he own a small flat which he is intending to use for coaching classes..other than the one referred to above one more flat booking but still no ready and delivered
  2. Karan Batra

    Karan Batra Well-Known Member

    The Cost Inflation Index for the year 2014 has not been announced yet by the govt and therefore it is difficult to compute the Capital Gain and Tax payable thereon.

    The approx capital gain after taking into account the estimated figure for cost inflation index would be 20 Lakhs out of which 12 lakhs would be exempted and 8 lakhs would be taxable @ 20%. Tax payable = 1.6 Lakhs

    The exact figures can be determined only after the Cost Inflation Index for 2014 is announced.
    tushar gandhi likes this.
  3. j m joshi

    j m joshi New Member

    Hi Karan,
    Thanks...you seems to be most active on this section.
  4. Murtuza sadikot

    Murtuza sadikot New Member

    Hello Good day everyone.

    I am an NRI and an FCA for many years............ I am settled overseas working in a diverse field ( not core CA). I am currently not up-to-date on all of the Indian income tax rules related to non residents.
    I am told there is a significant update to the taxation provisions related to NRIs and were introduced about 12-14 months ago in the areas of capital gains, TDS, TCS, deemed incomes, stamp duty etc......It will be nice if somebody can highlight these in brief.

    My specific areas of interest are the below:
    1. NRI who has more than 1 residential property ( capital gains, TDS, stamp duty etc......)
    2. NRI who is planning to invest in the names of spouse, children ( any of the above.....)
    3. incomes from one or more properties ( deemed incomes, sales etc...)
    4. any particular restriction on the type of properties nri can purchase ( I heard some restrictions have been put on farm houses)
    5. what are the provisions w.r.t NRI being a director or a majority shareholder in an indian company whose major line of business is Investments ( real estate, stock and shares)

    I think I will pause at this point and shall await a few responses before I park more questions to the forum.
  5. Kannan

    Kannan New Member

    I would like to know whether interest paid on FD of capital gain account can be withdrawn and used for houseold expenses?
  6. Neha Sharma

    Neha Sharma Active Member

    Dear @Kannan

    The interest on FD from Capital Gain Account Saving Scheme can be withdrawn and used for household expenses. It need not be reinvested ...

    This interest earned on Capital Gains Account is same as interest on normal FD and you would be required to pay tax as per slab rates....

    VAIBHAV DILIP RANE Active Member

    C.I.I. of 2014 = 1024.

    SURAJ PAL SINGH New Member

    Hello active members,
    I had purchased a residential plot of 1600,sq. ft. in yr.Feb. 1995 for a cost of Rs. 1.30 Lakh. Now I am getting Rs.46 Lakh for it.What will be LTCG tax on this deal.I am NRI for last six years and as such have no salaried income in India & no IT returns being submitted for these six yrs. How this LTCG will be dealt at U.S. where I have become citizen a year back.

    VAIBHAV DILIP RANE Active Member


    1) If you are Resident, than your LTCG shall be reduced by the Exemption Limit and than LTCG shall be charged @20%

    2) If you are Non-Resident than straight away LTCG Tax shall be charged @ 20% on the gain amount.

    We have consider you as Non Resident -

    A] Asset purchase for Rs. 1,30,000
    B] Indexed Cost of Acquisition = Rs. 5,13,977
    C] Sale Consideration = Rs. 46,00,000
    D] Long Term Capital Gain [C-B] = Rs. 40,86,023

    E] LTCG Tax @20% on [D] = Rs. 8,17,205
    F] Cess @ 3% on [E] = Rs. 24,516

    G] Total Advance Tax Payable = [E+F] = Rs. 8,41,721

    * Please note at the time you sold property, pay the tax to the government, and file the return for the year.
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