Cost Inflation Index (CII) Table for Property Sales in India

What is Cost Inflation Index (CII) in Property Capital Gains?

The Cost Inflation Index (CII) is a number published every year by the Income Tax Department to adjust the purchase price of an asset for inflation.

When calculating long-term capital gains on property, the purchase cost is increased using the CII to reflect inflation. This process is called indexation.

Indexation helps taxpayers reduce taxable capital gains, which ultimately lowers the tax payable on property sales.

For example, if you bought a property years ago, the inflation-adjusted cost will be much higher than the original purchase price, resulting in lower capital gains tax.

Why Cost Inflation Index is Important in Property Sale

CII is used to calculate the Indexed Cost of Acquisition when a property qualifies as a long-term capital asset.

A property becomes long-term if it is held for more than 24 months before selling.

Benefits of using CII:

• Adjusts property cost for inflation

• Reduces taxable capital gains

• Ensures fair tax calculation

• Required when claiming long-term capital gains tax benefits

Cost Inflation Index (CII) Table – Latest Values

Below is the official Cost Inflation Index table used for capital gains calculations.

The base year for indexation is 2001-02, which means property purchased before 2001 can use Fair Market Value as of 1 April 2001 for capital gains calculation.

Formula for Indexed Cost of Acquisition

The formula used to calculate indexed cost is:

Indexed Cost = Purchase Cost × (CII of Sale Year ÷ CII of Purchase Year)

This formula adjusts the purchase price to today’s inflation level.

Example of Property Indexation Calculation

Suppose:

• Purchase price = ₹10,00,000

• Purchase year = 2005-06 (CII = 117)

• Sale year = 2024-25 (CII = 363)

Indexed cost calculation:

Indexed Cost = 10,00,000 × (363 ÷ 117)
Indexed Cost = ₹31,02,564 (approx.)

If the property is sold for ₹70,00,000, the capital gain would be:

70,00,000 − 31,02,564 = ₹38,97,436

Tax will apply only on the inflation-adjusted gain.

When Can You Use Indexation?

Indexation is available when:

• Property is held more than 24 months

• Capital gains are classified as long-term

• Asset qualifies for long-term capital gains taxation

Indexation is not allowed for short-term capital gains.

Property Purchased Before 2001

If a property was purchased before April 1, 2001, the taxpayer can choose:

• Actual purchase price, or

• Fair Market Value (FMV) as on 1 April 2001

The higher value can be used to reduce capital gains tax.

Common Mistakes in CII Calculation

Many taxpayers make mistakes while calculating capital gains:

• Using incorrect financial year

• Ignoring improvement cost indexation

• Not applying indexation to renovation expenses

• Using wrong CII values

These mistakes can lead to incorrect tax reporting and higher tax liability.

Get Expert Help for Capital Gains Calculation

Calculating capital gains on property can become complicated, especially when:

• Property was purchased many years ago

• Renovation costs need to be indexed

• Property is jointly owned

• The seller is an NRI

CA Shiwali, a Chartered Accountant specializing in property taxation, helps individuals correctly calculate capital gains and minimize tax liability.

Services include:

• Capital gains tax calculation

• Property tax planning

• NRI property sale taxation

• Lower TDS certificate assistance

📞 Call CA Shiwali: +91-9266032777

Frequently Asked Questions

What is the base year for Cost Inflation Index?

The base year for CII calculation is 2001-02, with index value 100.

Is CII used for short term capital gains?

No. CII is used only for long term capital gains calculation.

Who publishes Cost Inflation Index?

The Cost Inflation Index is notified every year by the Central Board of Direct Taxes.

Need Help Calculating Capital Gains on Property?

Property capital gains calculations can become complicated — especially when indexation, inherited property, joint ownership, or property purchased before 2001 is involved. Even small mistakes in calculation can lead to higher tax liability or notices from the Income Tax Department.

If you are planning to sell property or have already sold one, it is always advisable to consult a qualified professional.

CA Shiwali, a Chartered Accountant specializing in property taxation and capital gains, helps individuals, NRIs, and property investors correctly calculate their tax liability and plan their taxes legally.

Her services include:

• Capital gains calculation for property sales

• Cost inflation index and indexation benefit calculation

• Tax planning to reduce capital gains tax

• NRI property taxation and TDS compliance

• Income tax return filing after property sale

Getting professional guidance ensures that your capital gains tax is calculated correctly and you claim all eligible benefits under the Income Tax Act.

Contact CA Shiwali

If you need help with capital gains calculation or property tax planning, you can contact CA Shiwali directly.

📞 Phone: call/ Whatsapp +91-9266032777
🌐 Website: https://cashiwali.com
📧 Email: cashiwalidagar@gmail.com

You can also reach out through the contact form on the website to discuss your case and receive professional guidance.