Fintotal News Analysis | Cost Inflation Index for 2012-13
Cost Inflation Index for 2012-13
Ruby Jacob, 18 Sep 2012

Central Board of Direct Taxes (CBDT) has notified Cost Inflation for the financial year 2012-13 as 852. Cost inflation index is calculated by CBDT every year. CBDT is responsible for direct taxes in India and is under the purview of the Ministry of Finance's Department of Revenue.

Cost inflation index is useful in computing taxable income from long term capital gains for individuals and HUFs. The index has base year 1981-82 with value 100 for that year. It has risen by 8.5% from last year's number of 785.

Income tax assessees can raise their cost of acquisition or improvement to the rate it would have been in the year of sale while computing long term capital gains on the transaction in order to account for inflation. You can refer to Cost Inflation Index (CII).

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