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    I purchased a plot in June 1997 and sold it in June 2019. How will I calculate the capital gains tax?

    Synopsis

    If you have held the asset for more than 24 months, the resulting capital gain from the transaction will be categorised as long term capital gain. The tax rate of LTCG is 20.8% with indexation.

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    You can save tax by investing in modes prescribed under the Income Tax Act.
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    I purchased a plot in June 1997 and sold it in June 2019. The transaction resulted in a capital gain of Rs 9 lakh. How will I calculate the capital gains tax?
    Shubham Agrawal, Senior Taxation Advisor, TaxFile.in
    replies Since you have held the asset for more than 24 months, the resulting capital gain from the transaction will be categorised as long term capital gain. The tax rate of LTCG is 20.8% with indexation. You can save this tax by investing in modes prescribed under the Income Tax Act.

    I am a private sector employee with an NPS Tier I account. I would also like to invest in a Tier II account for its operational flexibility and low operational charges. I have read that on withdrawal from a Tier II account, the entire corpus is taxable. Is it true or only gain on investment is taxable?
    Raj Khosla Founder and Managing Director, MyMoneyMantra.com
    replies: The Tier II NPS account is an add-on account that offers flexibility to invest and withdraw without any exit load, just like a savings account. It is thus an excellent option if you want to tap dual benefits of saving and investing through available market-linked options while enjoying utmost liquidity. Since you already have an active Tier I account, you can go ahead and reap the benefits of the Tier II NPS account. Earnings through Tier II account are taxable as per applicable taxation rules on capital gains. The capital gains are calculated as a difference between NAV of purchase date and redemption date multiplied by the number of units used for redemption.
    (Disclaimer: The opinions expressed in this column are that of the writer. The facts and opinions expressed here do not reflect the views of www.economictimes.com.)
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