Hi,
I would like to know whether internet charges (yearly) paid and charges paid to CA are deductible from capital gain tax.
Thx
Hello @Karuna
No, internet charges and CA fees are not deductible from capital gains tax. Only expenses directly related to the transfer of the capital asset, such as brokerage, transaction fees, and stamp duty can be deducted.
Hope this helps!
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@Shreya_Sharma what about stt, can we deduct it from capital gains?
Hello @Manish
No, Securities Transaction Tax (STT) cannot be deducted when calculating capital gains. While expenses such as brokerage, transaction charges, and stamp duty are allowed, STT is specifically disallowed under the Income Tax Act. Since capital gains on which STT is paid are already taxed at concessional rates, claiming STT as a deduction is not permitted.
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Can cost of acquisition of a new flat include stamp duty and registration charges? Can these expenses be drawn from the Capital Gains Acccount opened with the bank (pending purchase of flat) for paying stamp
duty and registration charges for the flat?
Hello @Narayanan_Nagarajan
Yes, the cost of acquisition of a new flat includes stamp duty and registration charges, as per Section 48 of the Income Tax Act, 1961. These expenses are considered part of the total cost of acquiring the asset and can be added to the purchase price.
If you have deposited your net consideration in a Capital Gains Account Scheme (CGAS) under Section 54 or 54F, you can use the funds to pay stamp duty and registration charges for the new flat.
Hope this helps!
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Thank you very much. Kindly also advise whether expenses for fixtures like wooden cupboards and modular kitchen which one does not dismantle will form part of cost of acquisition and will qualify for drawing from capital gains account.
Hello @Narayanan_Nagarajan
In our opinion, If the cost of fixtures is included in the price of your new property, it can be considered part of the cost of acquisition and you can withdraw funds from the Capital Gains Account Scheme (CGAS) for it. However, if you incur these expenses separately as capital improvements, they will be treated as the cost of improvement and cannot be withdrawn from CGAS.
Hope this helps!