How to save capital gain

you would need to calculate the indexed cost of aquisation to find out the amount of capital gain. This is done by multiplying the cost of purchase by the cost inflation index of the year of sale and dividing by the cost inflation index of year of purchase. This would give the indexed cost of aquisation.

Subtract this from the sale consideration. The balance will be the capital gain amount that can be invested in some approved schemes that would save the tax.

Dear Friend,

In order to answer the question, following details are required:-

1) Cost of acquisition

2) Date of Acquisition

3) Nature of Capital asset

4) Date of Sale of capital asset

The Capital Gain computed after Indexation can also be saved by re-investing as per guidelines laid in Section 54

Sir:

I have a similar situation ie. sale of residential property to be completed shortly. This comes under LTCG as property is more than 10 years.  Do advise if the sale proceeds can be invested in purchase of "residential land and the balance along with housing loan be put towards construction of a house".  Can I claim Tax exemption for the housing loan?  The housing loan will be obtained only for purpose of construction and not for purchase of land. 

If the capital gain liabilites is bellow 50 lakhs then you can invest in the Rurel energy infrastrecture bond for their years locking period. then that amount is totaly exempted