• Income tax

I had been working in Spore for 10+ years and settled back in India in 2015. I have my accumulated CPF Savings in SPore. I own a residential property in Spore which was rented out.
After RNOR staus completed, offered the Rental Income from property to Tax in India. MY PR will be over in March 2021. 
1. So I am selling my house property in this FY. After indexation of purchase value, the LTCG will be negative. Can I take India inflation indexing for arrinving at Cost of Acqusition. And will this LTCG Loss eligible for CFL in our ITR.
2. I will be receving the entire CPF proceeds from SPore in a month. While the CPF contributions which ended in 2015 is earning interest from 2015. And while the interest earned during my RNOR status is excempt from India Tax, will the interest earned in last 2 years taxable here OR NOT? Being interest earned in CPF account? While tax exempted amount will be shown in CFL, LTCG in Sch. CG, kindly clarify whether post Resident India period interest earne to be exempt and added to CFL or offered to tax under Income from Other sources. A lot of thanks in advance and appreciate your multiple CAs responses and comments. .
Asked 3 years ago in Income Tax

Dear Sir,

 

Hope you are doing well !!

 

1. Yes, you will get the indexation benefit on the same.

 

Please note that the ITR is filed before due date to carry forward the capital loss.

 

Please note that the Income Tax does not allow loss under the head capital gains to be set off against any income from other heads – this can be only set off within the ‘Capital Gains’ head. Long Term Capital Loss can be set off only against Long Term Capital Gains. Short Term Capital Losses are allowed to be set off against both Long Term Gains and Short Term Gains.

 

Fortunately, if you are not able to set off your entire capital loss in the same year, both Short Term and Long Term loss can be carried forward for 8 Assessment Years immediately following the Assessment Year in which the loss was first computed.

 

Also, you cannot be carried forward the losses if the return is not filed within the original due date .

 

2.It would be taxable under the head income from other sources.

 

 

Payal Chhajed
CA, Mumbai
5188 Answers
288 Consultations

5.0 on 5.0

Yes, You can get the property sale loss to CFL for future set off with India LTCG.

Payal Chhajed
CA, Mumbai
5188 Answers
288 Consultations

5.0 on 5.0

It is advisable to take a phone consultation for detailed discussion.

 

We may assist you in entire procedure.

Payal Chhajed
CA, Mumbai
5188 Answers
288 Consultations

5.0 on 5.0

1. In F.Y. 2020-21, your residential status is ROR, it means global income will be taxable in India. While filing ITR in India, provisions of Income tax as per Indian law will be applicable on foreign income as well therefore benefit of Indexation would be available to you. You can CFL and set off against LTCG future. In ITR, you have to fill schedule FA,FSI etc.

2. Interest from CPF will be taxable in India from the year in which you became ROR.

3.  Application of exchange rate is a critical matter. First do the indexation of cost in the foreign currency till the date of sale. Apply exchange rate on profit or loss element on the date of transfer.

 

For detailed discussion, please contact telephonically.

Vivek Kumar Arora
CA, Delhi
4825 Answers
1031 Consultations

5.0 on 5.0

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