| My 50-year-old house is being demolished for building a multi-storied building. Of my share of four flats, I intend to sell two. What would be the capital gains tax on the sale proceeds? Is there any means to avoid it?? |
P. Dasgupta, Jadavpur |
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| You will have to pay capital gains tax on two occasions. First, when the developer hands over the possession of the flats to you or when the construction is completed or when the deed of conveyance is registered, whichever is earlier. Second, when you sell the flats. In the first instance, the capital gains will be the cost of construction of the flats minus the cost of acquisition of the land. In the second instance, the capital gains would be the sale price of the flats minus the cost of construction of the flats. You can invest the capital gains in bonds of the Rural Electrification Corporation or the National Highway Authority of India permitted for tax exemption. |
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| At your will |
| I am 75-years-old. I have PAN and a GIR number. I have been maintaining an income tax file and balance sheet since 1980. From 2001 to 2006, I didn’t have any taxable income but I submitted my returns. In 2006-07, I worked for about 10 months for which I had a salary income. I had filed income tax return in ITR-1 for the assessment year 2007-08 and expect a refund of Rs 1,922. Should I have to submit tax return for the assessment year 2008-09? My present source of income is from interests on bank and post office deposits. My present income is below the basic exemption limit. |
D.P. Ghosh, Calcutta |
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| For those whose annual income is less than the basic exemption limit, filing of returns is voluntary. You may not file returns if your annual income in the previous fiscal is less than the maximum income not chargeable tax. |
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| Option area |
| I am 65-years-old. I have a bank FD of Rs 1 lakh. Which will be a better option for me showing the accrued interest every year or showing the total interest on maturity of the deposit? |
Subir Das, Calcutta |
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| It will depend on your total annual income. It will be better if you show the interest income every year in your return. |
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| If you have any queries about investing or taxes or a high-cost purchase you are planning, mail to: btgraph@abpmail.com, or write to: Business Telegraph, 6 Prafulla Sarkar Street, Calcutta 700 001. |
