Any expenses which are attributable to the purchase of property are allowed to be added in the cost of acquisition of the property.
I have paid stamp duty, freehold charges, arrears of property tax, entry fees in society and brokerage to an estate agent. Will this be added to the cost of acquisition of the property while calculating index value?
– BR Babu
Any expenses which are attributable to the purchase of property are allowed to be added in the cost of acquisition of the property. Hence, expenses like stamp duty, freehold charges, etc., will be added to the cost of the property. The resultant amount shall be indexed as per the Cost Inflation Index notified by the government at the time of sale to calculate the capital gains. However, these payments must be evidenced by the proof of actual payment.
I am a government employee filling ITR 1 every year. I have sold some mutual funds on which I have got long-term capital gains for equity and some short-term gains for debt. Please suggest the ITR form for return and on which section I have to show these.
The forms for ITR for a particular financial year are notified after the end of that year. Assuming you have earned these gains in the current financial year, i.e. FY18, the forms will be notified in March or April 2018. Assuming that the forms don’t have any material changes, you will have to file return of income in ITR-2. The section to be filled up is Part B of schedule CG “Compu-tation of Income under Capital Gain”.
I am a small-scale tour operator in Kerala and have a turnover of Rs 55 lakh. The retention is not more than 3%. Should I get my accounts audited?
You can opt for presumptive taxation scheme since your turnover does not exceed Rs 2 crore. Under this scheme, your presumptive income will be calculated at 8% (6% if the collection is received through banking channel and other online modes) of the annual turnover. Thus, this helps save the cost of maintaining the books of accounts and also saves you from getting your accounts audited. However, if you wish to show that your profits are actually below 8% and pay tax accordingly, then this presumptive scheme will not apply to you even if your turnover is below Rs 2 crore and you will need to maintain accounts and get these accounts audited from a chartered accountant.
The writer is a partner, Ashok Maheshwary & Associates LLP. Send your queries to email@example.com