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Only spouse can be second holder in senior citizen plan

I purchased my first flat in October 2012 for Rs 30 lakh. I sold it in August 2017 at Rs 40 lakh. I purchased the second flat in August 2017 for Rs 90 lakh. Both the flats were bought via home loan. Please suggest on capital gains tax.—Sahil Shah

Based on the facts stated by you, there is no question of any long-term capital gains tax (LTCG). Your cost of acquisition in October 2012 is Rs 30 lakh. The index value for financial year 2012-13 was 200 while the index value for financial year 2017-18 is 272. Therefore, the indexed cost of acquisition works out to Rs 40,80,000 as follows. Since the indexed cost is more than the sale price of Rs 40 lakh, you will not have any LTCG chargeable to tax. In fact, you will be able to claim a long-term capital loss of Rs 80,000 which can be set off against any LTCG in the same year or later years.

I am 81 years old and have deposited Rs 15 lakh in post office senior citizen saving scheme (SCSS) jointly with spouse. Now, I want to deposit the same amount in my wife’s name and mine, as second holder. But, the post officer says limit of both entity has been exhausted being joint holders. Please advise me on this.—Radheshyam Chowdhry

The second holder in a SCSS account (a/c) can only be the spouse, and the eligibility or any other condition is not applicable to the second holder (Rule 3(3) of the SCSS Rules 2004). In fact, the spouse’s age can be lower than 60 years also. The spouse can separately open her own SCSS a/c if she is otherwise eligible. This is clarified on many PSU banks’ website. Even the India Post Office website seems to indicate this view though not crystal clear. They mention that in case of joint a/c, the first named account holder shall be treated as the investor. However, if the post office is not agreeing to open the account in your spouse’s name, you can always open it in any PSU bank. If the money deposited in your spouse’s a/c belongs to you, the interest on such SCSS a/c will be taxable under the clubbing provisions.

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