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How is capital tax calculated?
23-May-2023 (In Tax Law)
What is the procedure or the formula to calculate capital tax?
Capital Gains is calculated by deducting from full value of consideration
received or accumulated as a result of transfer the following amount:
(i) Expenditure incurred wholly and exclusively in connection with such transfer
(e.g. brokerage or commission for securing a purchaser, registration fee,
travelling expenses in connection with transfer); and
(ii) the cost of acquisition of the capital asset and cost of improvement thereto.
However, in case of transfer of a long term capital asset after deducting the
expenditure incurred wholly and exclusively in connection with such transfer,
the 'indexed cost of acquisition' and 'indexed cost of improvement' has to be
deducted.
received or accumulated as a result of transfer the following amount:
(i) Expenditure incurred wholly and exclusively in connection with such transfer
(e.g. brokerage or commission for securing a purchaser, registration fee,
travelling expenses in connection with transfer); and
(ii) the cost of acquisition of the capital asset and cost of improvement thereto.
However, in case of transfer of a long term capital asset after deducting the
expenditure incurred wholly and exclusively in connection with such transfer,
the 'indexed cost of acquisition' and 'indexed cost of improvement' has to be
deducted.
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Adv. Siddhant Sharma
Delhi | 200+ Answers
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