Article discusses Meaning of Cost Inflation Index (CII) which is used for Computation of Long Term Capital Gain. Cost Inflation index are Notified by CBDT every year and till date CBDT has notified Cost Inflation Index for the Financial Year 1981-82 to Financial year 2024-25. Cost Inflation index are used for computing indexed cost of acquisition.
What is Cost Inflation Index (CII)?
It is a measure of inflation that finds application in tax law, when computing long-term capital gains on sale of assets. Section 48 of the Income-Tax Act defines the index as what is notified by the Central Government every year, having regard to 75 per cent of average rise in the consumer price index (CPI) for urban non-manual employees for the immediately preceding previous year. Therefore, if we consider that price of a capital asset has risen in tandem with base price rise, then if one want to sell an asset and replace it, the cost allowed even after indexation will be lesser than the price payable for new asset. However, in case of many capital asset the price rise is lesser than market price and in many cases it is higher.
How does Cost Inflation Index (CII) help in capital gains computation? Capital gain, as you know, arises when the net sale consideration of a capital asset is more than the cost. Since “cost of acquisition” is historical, the concept of indexed cost allows the taxpayer to factor in the impact of inflation on cost. Consequently, a lower amount of capital gains gets to be taxed than if historical cost had been considered in the computations.
Formula for computing indexed cost is (Index for the year of sale/ Index in the year of acquisition) x cost.
For example, if a property purchased in 1991-92 for Rs 20 lakh were to be sold in A.Y. 2009 -10 for Rs 80 lakh, indexed cost = (582/199) x 20 = Rs 58.49 lakh. And the long-term capital gains would be Rs 21.51, that is Rs 80 lakh minus Rs 58.49 lakh.
Cost Inflation Index:- Cost inflation index (CII) as notified by Central Government alongwith analysis of the same is as under:
Cost Inflation Index As Applicable From Financial Year 1981-82 To Financial Year 2016-17
| FINANCIAL YEAR | COST INFLATION INDEX | Increase in CII and 75% of percentage of real inflation allowed | Real inflation % of CII Increase allowed / 3 X 4 |
| 1981-1982 | 100 | ||
| 1982-1983 | 109 | 9 = 9% | 12% |
| 1983-1984 | 116 | 7= 6.422 | 8.56% |
| 1984-1985 | 125 | 9=7.7586 | 10.34% |
| 1985-1986 | 133 | 8=6.4 | 8.53% |
| 1986-1987 | 140 | 7=5.263 | 7.02% |
| 1987-1988 | 150 | 10=7.1428% | 9.52% |
| 1988-1989 | 161 | 11=7.333% | 9.78% |
| 1989-1990 | 172 | 11=6.8323% | 9.11% |
| 1990-1991 | 182 | 10=5.8139% | 7.75% |
| 1991-1992 | 199 | 17=9.340% | 12.45% |
| 1992-1993 | 223 | 24=12.060% | 16.08% |
| 1993-1994 | 244 | 21=9.4170% | 12.56% |
| 1994-1995 | 259 | 15=6.1475% | 8.20% |
| 1995-1996 | 281 | 22=8.494% | 11.33% |
| 1996-1997 | 305 | 24=8.5409% | 11.39% |
| 1997-1998 | 331 | 26=7.8549% | 10.47% |
| 1998-1999 | 351 | 20=6.0423% | 8.06% |
| 1999-2000 | 389 | 38=10.826% | 14.44% |
| 2000-2001 | 406 | 17=4.370% | 5.83% |
| 2001-2002 | 426 | 20=4.926% | 6.57% |
| 2002-2003 | 447 | 21=4.93% | 6.57% |
| 2003-2004 | 463 | 16=3.58% | 4.77% |
| 2004-2005 | 480 | 17=3.67% | 4.90% |
| 2005-2006 | 497 | 17=3.54% | 4.72% |
| 2006-2007 | 519 | 22=4.43% | 5.90% |
| 2007-2008 | 551 | 32=6.17% | 8.22% |
| 2008-2009 | 582 | 31=5.62% | 7.50% |
| 2009-2010 | 632 | 50=8.60% | 11.46% |
| 2010-2011 | 711 | 79=12.36% | 16.49% |
| 2011-2012 | 785 | 74=10.41% | 13.88% |
| 2012-2013 | 852 | 67 = 8.54% | 11.38% |
| 2013-2014 | 939 | 87 =10.21% | 13.62% |
| 2014-2015 | 1024 | 85 = 9.05% | 12.07% |
| 2015-2016 | 1081 | 57 = 5.57% | 7.42% |
| 2016-2017 | 1125 | 44 = 4.07% | 5.43% |
Cost Inflation Index from Financial Year 2001-02 to Financial Year 2024-25
In order to revise the base year for computation of capital gains, section 55 of the Income Tax Act, 1961 was amended vide Finance Act, 2017 so as to provide that the cost of acquisition of an asset acquired before 01.04.2001 shall be allowed to be taken as fair market value as on 1st April, 2001 and the cost of improvement shall include only those capital expenses which are incurred after 01.04.2001. Cost inflation index for Long Term Capital Assets sold after 01.04.2017 as notified by CBDT Notification No. 44/2017 dated 05.06.2017 as amended from time to time.
| TABLE | ||
| SI. No. | Financial Year | Cost Inflation Index |
| (1) | (2) | (3) |
| 1 | 2001-02 | 100 |
| 2 | 2002-03 | 105 |
| 3 | 2003-04 | 109 |
| 4 | 2004-05 | 113 |
| 5 | 2005-06 | 117 |
| 6 | 2006-07 | 122 |
| 7 | 2007-08 | 129 |
| 8 | 2008-09 | 137 |
| 9 | 2009-10 | 148 |
| 10 | 2010-11 | 167 |
| 11 | 2011-12 | 184 |
| 12 | 2012-13 | 200 |
| 13 | 2013-14 | 220 |
| 14 | 2014-15 | 240 |
| 15 | 2015-16 | 254 |
| 16 | 2016-17 | 264 |
| 17 | 2017-18 | 272 |
| 18 | 2018-19 | 280 |
| 19 | 2019-20 | 289 |
| 20 | 2020-21 | 301 |
| 21 | 2021-22 | 317 |
| 22 | 2022-23 | 331 |
| 23 | 2023-24 | 348 |
| 24 | 2024-25 | 363 |
Last Updated on 25.05.2024
(Republished with Amendment, Source -Income Tax Website)
Author Bio
Dear Sir,
We have sold a property for Rs1600000 on 30th march 2012 and had acquired the possesion in the year 2003 as gift from my grandmother .We are not aware of the property value when we aquire this prpoerty but can tell you nits valuation in the year 1989 -90 was 104400 for 100 sq.ft.Can you please help me finding the value of this land and tell us weather we have got a capital gain or not.and if we dont have any capital gain than can we invest this amount in FD’s to get interest income.
sir i want to know that if a man sales and purchases the property in a financial year 3-4 four times dn how the capital gain tax will effect.
WE HAD AHAVELI OLD MORE THAN 80 YRS IN HARYANA PURCHASE PRICE DON’T KNOW SOLD IT IN FEBUARY-2012 IN 6 LACS DIVIDED IN THREE PERSON 2 LAKH EACH HOW MUCH WILL BE LONG TERM CAPITAL GAIN HOW MUCH TO BE INVEST IN 54 EC BOND-REC/– NHAI IS IT NECESSARY TO INVEST. AT PRESENT AMOUNT IS IN SAVING ACCOUNT PLEASE ANSWER AT EARLIEST– AT PRESENT I AM NOT COVERED UNDER INCOME TAX MY ANNUAL INCOME IS LESS THAN TAXABLE AFTER GETTING REBATE ON INVESMENT RS-1 LAKH
circle rates under noida authority in 1981-1989 ..
I purchased a PLOT in Nov 2000 for Rs 72, 000 & incurred lease rent Rs 25000 upto 2011.Now i want to sale the same PLOT in march2012 in Rs 10,00,000 . what will be the capital gain tax i have to pay now. Kindly advice.
i have paid my 1st & 2nd installments of 15.09.11, 15.12.11 regularly. on 15.03.12 i have to make 3rd installments, but in `E’ payments the bank`s is not allowing me a payments of Rs.54 lac which is my 3rd installments payable by me on 15.03.12. Can i make this in two breaks or not before 15.03.12? Please clearify.
one of my client has sold his half property in January1981 for Rs.26 lacs and other half was to get constructed at Rs.100/- per sft.by the purchaser.Due to some problem the purchaser did not honour the terms and conditions of the agreement.Again in the year 1992 the property was sold to Z (by the 1st vendor and the 2nd vendor).Due to lower valuation the IT Dept.acquired the property.The acquisition was challanged and pending the acqusition ( acqusition provisions were repealed)the property was sold to another party in the year 2006(by both the vendor) with the understanding of Z.Now my question is what is the value of cost for the 1st vendor.Please note that eventhough the 2nd vendor is a party to the final agreement of 2006 he never became the owner to claim any cost in the computation.
KINDLY EMAIL OF IMPORT MACHINERY ENTRY
I HAVE PURCHASE SHARES AT VALUE OF RS.1200000 RATE PER SHARE 30 PURCHASE DATE 12/01/2011.
I SOLD THE SHARES AT VALUE OF RS.17,07,433 OF 10400 SHARED. SALES DATE 24.01.2012
KINDLY LET ME KNOW THE CAPITAL GAIN
Dear Sir,
I would be grateful if you could provide the answer to my following query
.
a) My grandfather purchased a plot 60 years ago and Constructed a house on it.
b)He died intestate and later after almost 40 years after his death(died in 1965) there was release deed done in favour of one of the children of this person with mutual consent of the rest of the children c). The present owner( in whose name the release deed was made) would like to dispose this plot as per current market rate . For Eg: Say the Total Consideration received would be around 50 lakhs.
d)For Calculation of Indexation how would the Price for Purchase Calculated and at what rate .( If initial purchase price records are not avialable then what will be the price ) Thanks for answering my query
I had purchased a property with small house in 1983 for RS.50,000.
In the year 2006 I demolished the house and built a new house with 2600 square feet plinth area and at a cost of 23 Lakhs. In 2012 I disposed the property for RS.35 Lakhs. I want to know what is the capital gain for this deal.
Many of us have raised important question which is what if the property purchased before 1980 (say ancient property purchased in 1965 at 1000 Rs) how CII will be calculated or benefited at the inflated property selling price in 2012? (say 2012 current cost is 20 lakhs)
@Although few people said that CII prior to 1980 will remain 100 but how true is it? Is there any notification / proof available online? Even If I assume for moment that’s true than the property purchased in 1981 will get highest tax benefit compared to person who has purchased property in 1965 say for 1000 rs? That’s absolutely ridiculous !
I will really appreciate right advice / help
Dear Sir,
First of all thanks for your time.
Question : I purchased a residential plot in 2002. The price per government records / registration price was much lower than the actual price paid to the seller (market value).
If for Tax purposes, I have to go by the Government Rate / Price, I will end up paying more tax than what I actually owe. My question is, which of the two amounts (Government valuation or Market Price) will be considered as “Cost of Acquisition” for Tax calculations?
Thanks in advance for your help.
Best Regards,
-Bala.
My father purchased residential property in 1995-1996 for Rs. 5 lacs, now we are planning to sell this property for Rs 20 lacks. The sale amount i.e. 20 Lacks will want to give the gift to my sister for purchasing new property , she is married and her husband want to buy the new property in his own name, then in this case kind help
1) How much capital gain tax will be charged to my father ?
2) How to save capital gain tax ? 3) whether any tax to my sister ?
I have purchased flat in 2004-2005 for 22 lacs + house improvement exps of 3 lacs = total 25 lacs. I am not planning to sell the flat now for 30 lacs.
I want to know what is the cost of indexatation for my flat in 2011-2012.
Also if I am selling for 30 lcas, then will it be loss of property ? If so, can I claim tax benefit in 2011-2012 for this loss on property?
sir/madam,
i have purchased a house in 1990 @ rs 500000. and brokerage charge 1 %. at the time of finding CII, the cost of acquisition will be 500000+brokerage or only 500000????????
Sir
I have already a house since 1995 in ghaziabad. Got allotted a plot in Noida by authority in 2001, made payments in installment up to 2007. Registry in 2007 value approx 6.00 lac . Now wish to sale the plot of Noida value 45.00 lac approx . and wants to buy a flat value 60 lac . Is long term capital gain applicable ??
I purchased a plot in1995 for Rs 50,000/-, Registration-4,500/-; then spent 20,000/- for filling and demarcation(I have no proof of payment except payment voucher on plain paper) then Rs 10,000/- on boundary wall erection in 2001;If i sell it for Rs. 5,00,000/- what is capital gain
Harjit
i have sale my enssestal property which purchased in 1969.but we our selling it in 2011.the circle rate of that land in1981 is rs80per sq met.and today its circle rate is rs.3360per sq meter than what capital gain we have please tell us if u can .thanks,sangeet raebareliy.
dear sir,
i was surrender my LIC’s market plus bonds,
i was invested as on 31/10/2007.
i was surrender as on 30/04/2011.
is it taxable? if taxable what the capital gain and tax amount.
give tax planing for tax saving.
I HAVE PUCHASED A FLAT IN 1987 FOR RS 277500 WHICH IS SOLD IN 2010-11 FOR RS 3105000 . PLS TELL ME HOW MUCH TAX I HAVE TO PAY
We sold a house in Vijayawada for Rs.3950000 in November 2021, bought for Rs.220000 in 2001, No 1st floor when we bought. Then we built the 1st. It was ground only when purchased in 2001. 1st floor constuction cost Rs.3,00,000. please tell how much income tax we will pay now
my parental house was built in 1978 for rs 65000, parents passed away in 1993
the house was transferred on my name in 2009 and sold in oct 2011 at rs 25 lacs, Kindly advise capital gain will be calculated from 2009 or 1993 or from 1978, I have showing in income tax return rent received from 2004
pvt ltd can avail index cost capital gain COST INFLATION INDEX
Hi,
I have purchased a plot 1.6 Lakh in 1988 and constructed the house for 20 lakh in 1995-96. Now, I have sold the house for 72 lakh couple of weeks back and purchased another house for 35 Lakh. Do I need to pay any long term tax?
Regards,
-Simran
sale of agriculture land in the name of HUF Tax liability
WHAT WILL BE THE INDEXATION VALUE FOR PROPERTY BUILT IN 1974-75, FINANCIAL YEAR? IF THAT PROPERTY WERE TO BE SOLD TODAY, PL INFORM WHAT IS THE METHODOLOGY TO BE ADOPTED TO COMPUTE CAPITAL GAINS ON SALE IN 2011.
THANKS
This is a good article. However, it would have helped if the author had mentioned in the article the likely changes in the provisions, when the Direct Taxes Code is expected to be effective with from 1.4.2012. I request the author to write a fresh article once the DTC provisions are implemented. Thanks.
You will have to ascertain the Fair Market Value as on 01.04.1981. Compare this with the actual cost of acqusition. The higher of the two will be taken to be the cost of acqusition. This cost of acqusition will then be indexed. For example if the sale is made in FY 2011-12 and the Cost of Acqusition as determined above is Rs. 100/- then the indexed cost will be Rs. 100 x 785/100 i.e Rs. 785/-.
Now from the sale value ( example 1000/-) you should reduce the indexed cost of acqusition and any expense reltated to transfer and you will get capital gain of Rs. 215/-
How to compute capital gain on property built in 1970-71, 71-72 and sold now
If a person purchased a property and sells for a big amount of profit and does not pay tax then how IT Dept will take action
Hi Guru,
I have booked house in 1994-95. I have signed an agreement of purchase in 1999. What will the year of purchase for calculation of capital gain if I sell my house.
I am planning to buy house in July 2011. Later, I am planning to sell old house, which may be in 2 to 3 years prior to possession of new flat. Can I and obtain exemption on paying tax on capital gain?
Regards
what is purchase date
wht is short term capital gain tax for real estate….?
Dear sir,
What is the index cost of acquisition for financial year 2011-12. What is the LTCG tax exempted bonds for 2011-12. Rate of interest may please informed.
chiranjeevi
I purchases a house in June,1992 for Rs.190000/- and the conveyance deed was signed in Dec,1996.Judicial papers for Rs. 18000/-were used the; Now I have sold the said property for Rs. 14 Lacs on 18TH MAY, 2011. Please calculate the capital gains arising thereof. Also advise about the utilization of capital gains in infrastructural bonds.
Thanking you.
sir ihave puchase property in delhi for 27lacs in 2009 & sold it for 52lacs in 2011 so what will be the income tax slab for capital gain.
I had purchased a plot which was registered in July,2003 but the payment was made in installment from Sept,2000 to July, 2003. My question is which date will be considered as the date of investment for calculating the Capital Gain ?
The buying and selling price of property is considered based on the registration price or the sale agreement price. As in most of the cases there is a huge difference in them.
Kindly reply to this one
My mother purchased plot Rs.90,000/- in 1994, In 2005 we have build home at the cost of Rs.6,00,000/-on that plot, Now today i.e. Apr 2011 we are selling that home at Rs.31,00,000/- so my question is what is the capital gain tax my mother has to be pay. And how can i save that. As my mother is retired from a private company. Thanks.
sir what is CCI for 2011-2012?
what is the capital gain COST INFLATION INDEX for F.Y.2011-12?
If I sell ancestral property for X amount which is acquired decades ago by my father and we are three brothers. How do I calculate Long Term CG and tax outgo now. Also, how shall I calculate the value on 1-04-1980 for Indexation purpose if required by IT Act 1961.
Dear sir,
what is the capital gain COST INFLATION INDEX for a.y.2011-12?
SIR,
I WANT TO KNOW WHY CI INDEX IS NOT APPLICABLE FOR SHORT TERM CAPITAL ASSETS?
sir my purchase price of a agricultural land was of rs 5 lakhs and i had purchased it in 2005-06 f.y . and if i sell it at rs. 1.56 crores then i want to know that how much would i have to pay capital gain tax. and what are the other legal formalities which i would have 2 do??
regards
bagish
Dear sir,
When will the CII for Fin Year 2011-12 (Ass.Year 2012-13)be published. In case i sell my flat in the financial year 2011-12 (original Date of registration 25-01-08)which factors should i consider for working out the CG? Pl guide me
I had purchased a piece of land for Rs 700/- wayback in 1975 and sold it for 5 lakh. How to calculate the idexed value as the basis starts from 1981-82
What is cost inflation index for the assets that are bought before 1980?
sir i purchase a shop in 10-8-2006 rs.700000.00 and sale it 28-2-2011 5150000.00 how much ltcg
Dear Sr,
I have purchased one shop in may 2003 at Rs.3.5 lacs and sold in jan 2011 at 9.5 Lacs.What will be my LTCG.