Can we invest in commercial property to save capital gains tax?
Amit Maheshwari, Partner, Ashok Maheshwary and Associates replies: Yes, according to Section 54F of the Income-Tax Act, you can save capital gains tax on the sale of a commercial property by purchasing a residential property within a year before or within two years after the date of sale of the property.
How are capital gains calculated on commercial real estate?
To calculate the capital gain on the property, subtract the cost basis from the net proceeds. If it’s a negative number, you have a loss. But if it’s a positive number, you have a gain.
How do you calculate long term capital gains on commercial property?
Long term capital gain is calculated as the difference between net sales consideration and indexed cost of property. The benefit of indexation is allowed to set off the impact of inflation from the gains made on sale of the property so that the actual gains on property will be taxed.
What percentage is capital gains tax on commercial property?
Here are some unique factors of how CGT is applied for commercial property. The rates of CGT change depending on who owns the asset. A 30 per cent CGT rate is applied to any net capital gains for company owned assets, unless the company is a base rate entity where a lower rate of 27.5 per cent is available.
How do I submit capital gains tax?
Documents To Be Submitted
- Form 16 from your company. One form 16 or Form 16 Part A (If part B is separate)
- Additional Form 16. Additional Form 16 or if you have form 16 part B.
- Form 26AS Tax Credit Statement. …
- Aadhaar card.
- Capital Gain Statement. …
- Bank statement if interest received is above Rs.