Capital gain on sale of goodwill of a business, trademark or brand name, tenancy rights, route permits or loom hours, right to manufacture or right to carry on any business

The following are chargeable to tax as capital gains:
(i) Goodwill of a business. There will not arise any capital gain on the goodwill of a profession.
(ii) Trademark or brand name associated with the business;                                                           (iii) Right to manufacture, produce or process .any article or thing, for a consideration e.g. patent, copyright, formula, design.
(iv) Right to carry on any business;
(v) Tenancy rights;
(vi) Route permits;
(vii) Loom hours.
Cost of acquisition u/s 55(2) (a)

(a) If the assets are purchased- original cost of acquisition.
(b) In any other case- nil

Cost of improvement

(a) In case of goodwill of a business, right to manufacture ,produce or process any article or thing and right to carry on any business (whether self generated or purchased), shall always be taken as nil.
(b) For the other assets as mentioned above, it shall be taken as the actual capital expenditure incurred by the assessee on the improvement of that asset, whether such asset is self generated or purchased.

 

Particulars Rs.Rs.
Sale Consideration (Actual Amount) xxx
Less: Expenses of Transfer Actual Amount xxx
Net Consideration xxx
Less: Cost of AcquisitionNIL 
Less: Cost of ImprovementNILNIL
Taxable Capital Gains xxx

 

 

Computation of Capital Gains in case of Self Generated Tenancy Rights, Route Permits, Loom Hours, Trade Marks, Brand Name related with business —

Particulars Rs.Rs.
Sale Consideration (Actual Amount) xxx
Less: Expenses of Transfer Actual Amount xxx
Net Consideration xxx
Less: Cost of AcquisitionNIL 
Less: Cost of Improvementxxxxxx
Taxable Capital Gains xxx

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