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# Calculate Indexed Cost & Long Term Capital Gain applicable from FY 2017-18 (AY 2018-19)

Calculate Indexed Cost & Long Term Capital Gain applicable upto FY 2016-17

## Amendments related to Capital Gains applicable from w.e.f. 01.04.2017

 A. Details of Purchase of the property A1 Financial Year of Purchase / Acquisition of the Immovable Property 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20 2020-21 A2 Cost Inflation Index for the Year of Acquisition A3 Purchase Price of the Immovable Property A4 Add: Expenses relating to acquisition (e.g. brokerage, registration charges, legal expenses etc.) A5 Total Cost of Acquisition of the Immovable Property A6 Indexed Cost of Acquisition of the Immovable Property B. Details of Improvements carried out B1 Financial Year of carrying out improvement(s) 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20 2020-21 B2 Cost Inflation Index for the Year of Improvement B3 Cost of improvements carried out in the property B4 Indexed Cost of Improvement C. Details of Sale / Transfer of the property C1 Financial Year of Sale / Transfer of Property 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20 2020-21 C2 Cost Inflation Index for the Year of Sale / Transfer C3 Full value of consideration received for Sale / Transfer C4 Less: Expenses incurred on transfer of the property (e.g. brokerage paid, registration charges and legal expenses) C5 Net Value of Consideration Long Term Capital Gain

## Amendments related to Capital Gains applicable from w.e.f. 01.04.2017

• Shifting of base year - In order to revise the base year for computation of capital gains, section 55 of the Income Tax Act, 1961 was amended vide Finance Act, 2017 so as to provide that the cost of acquisition of an asset acquired before 01.04.2001 shall be allowed to be taken as fair market value as on 1st April, 2001 and the cost of improvement shall include only those capital expenses which are incurred after 01.04.2001.
• Holding period of immovable property - In order to avail the indexation benefit and the concessional tax rate of 20% on transfer of a long-term capital asset, the holding period for immovable property reduced from 36 months to 24 months.
• Investment of Long term Capital Gains - The current tax provisions provide for exemption of long term capital gains to the extent of INR 50 lakhs from tax, if the taxpayer invests the whole or any part of capital gains in National Highway Authority of India or Rural Electrification Corporation Limited bonds within the specified time. In order to stimulate investment and growth in other sectors through funding, the Budget proposed to extend this incentive to other Central Government notified bonds redeemable after 3 years. Though the tax payer will have options for investing in different bonds, the investment limit of INR 50 lakhs has not been altered.
• Capital gains arising in Joint Development Agreements ('JDA') - In order to reduce the burden on land owners being individuals or HUFs, the Budget proposes to consider the transfer as taking place in the year in which the development of the project is completed and taxing the capital gains in the year in which the certificate of completion is issued. The fair value of consideration for such transfer shall be deemed to be the aggregate of the stamp duty value as on the date of issue of the completion certificate and the consideration received in cash. Tax withholding at 10% is also proposed on the cash consideration payable to the land owner.
• Exemption under Section 10(38) of the Act - It has been proposed to restrict the exemption available on sale of listed shares, only to such shares which have suffered STT on purchase. The exceptions to this provision are as follows:
Shares purchase before October 1, 2004
Other shares to be notified by the Central Government, which are indicated:
Shares acquired in IPO
Shares acquired in FPO
Shares issued as bonus or right shares, etc.
• Conversion of Preference shares to Equity shares to be tax neutral - The Budget proposes to amend section 47 of the Act, stating that conversion of preference shares of a company to equity shares will not be treated as transfer. The absence of this provision had raised concerns as conversion of debentures into equity was specifically not treated as transfer

Cost inflation index for Long Term Capital Assets sold after 01.04.2017 as notified by CBDT Notification No. 44/2017 dated 05.06.2017

Financial Year(FY)Assessment Year(AY)Cost Inflation Index
2001-022002-03100
2002-032003-04105
2003-042004-05109
2004-052005-06113
2005-062006-07117
2006-072007-08122
2007-082008-09129
2008-092009-10137
2009-102010-11148
2010-112011-12167
2011-122012-13184
2012-132013-14200
2013-142014-15220
2014-152015-16240
2015-162016-17254
2016-172017-18264
2017-182018-19272
2018-192019-20280
2019-202020-21289
2020-212021-22301