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What is index cost for capital gain?

What is index cost for capital gain?

For the previous year, i.e., FY 2020-21, CII was notified as 301. CII is used to calculate the inflation adjusted cost price of an asset. The inflation adjusted price then is used to arrive at long-term capital gains or long-term losses….

Financial Year CII Number
2021-22 317
2020-21 301
2019-20 289
2018-19 280

How do you calculate capital gain index?

Formula for computing indexed cost is (Index for the year of sale/ Index in the year of acquisition) x cost. For example, if a property purchased in 1991-92 for Rs 20 lakh were to be sold in A.Y. 2009 -10 for Rs 80 lakh, indexed cost = (582/199) x 20 = Rs 58.49 lakh.

What is index value of property?

Example 1 : How to Calculate Indexed Cost of Acquisition Asset

Indexed Cost of Property Actual Purchase Price * (Index in year of Sale / Index in Year of Purchase)
Rs 20 Lakh * (280 / 113) = Rs 49.55 lakhs
Sale Amount 75 Lakh
Capital Gain 75 Lakh – Rs 49.55 lakh = Rs 25.44 lakhs

What is the cost inflation index for FY 2021-22?

Latest Cost Inflation Index FY 2021-22 | CII Chart AY 2022-23

Financial Year Assessment Year Cost of Inflation Index (CII)
2018-19 2019-20 280
2019-20 2020-21 289
2020-21 2021-22 301
2021-22 2022-23 317

How do you calculate index on sale of property?

The indexation factor can be calculated by dividing the Sale Year’s Cost Inflation Index by the Purchase Year Cost Inflation Index. Once this has been determined, the indexed acquisition cost of the house can be calculated by multiplying the initial purchase price of the house and the indexation factor.

How do you calculate the index?

Calculate the index by dividing the current-year result of 0.687 by the previous year result of 0.667 to yield an index of 1.032.

How is property price index calculated?

1. The current PPI is computed using the stratification method. Under this method, transacted properties are grouped into different categories based on property type, tenure, completion status, and region. The median prices for each category are then aggregated using 12-quarter moving average weights to derive the PPI.

Who is eligible for capital gains exemption?

The capital gains exemption (CGE) is available to individuals only, not corporations, and forms a deduction (worth 50% of the exemption, since 50% of capital gains are taxed) from net income. Benefits that use net income, such as the age credit and OAS clawback, will be calculated before the deduction is reflected.

What is the capital gains threshold 2020?

For example, in 2020, individual filers won’t pay any capital gains tax if their total taxable income is $40,000 or below. However, they’ll pay 15 percent on capital gains if their income is $40,001 to $441,450. Above that income level, the rate jumps to 20 percent.

How is long term capital gain index calculated?

Long-term capital gain index calculation is done by using the latest Cost inflation index prepared by the Government of India. It helps to calculate the index cost for capital gain. In other words – To calculate the long-term capital gains, individuals need to find out the indexed cost of an asset in question.

How is cost inflation index and capital gain index calculated?

Cost Inflation Index or as some people call it Capital gain Index is announced by the central government for every financial year, after referring to the CPI (Consumer Price Index) for the immediately preceding year. In simple language, Cost Inflation index factors in the change of inflation in capital assets year on year.

Is the capital gain tax based on indexation?

Based on Indexation what is the capital gain tax . As the Indexation starts in 2001 and the Flat was purchased in 1991 , will charted engineer certificate on capital gains vs indexation, which is a better method Would it be somewhere between 10 to 15 lacs ?

How is CII used to calculate capital gain tax?

CII is very useful to calculate Long Term Capital Gain Tax. Capital Gain = Sales Consideration – Indexed Cost of Acquisition Indexed Cost of Acquisition = Actual Purchase Price * (Index in year of Sale / Index in Year of Purchase)