For a slump sale, fair market value determined under the prescribed rule is deemed consideration and net worth is deemed cost.
For a slump sale, fair market value determined under the prescribed rule is deemed consideration and net worth is deemed cost. Revaluation is ignored, and an accountant report is required before the specified date.
Section 77 of the 2025 Act consolidates the slump-sale computation. Self-generated goodwill enters net worth at nil; depreciable assets use tax WDV and other assets generally use book value.
Identify the undertaking; calculate FMV1/FMV2; use higher deemed consideration; compute statutory net worth; classify holding period; furnish the report.
Contract price ₹12 crore, prescribed FMV ₹14 crore and net worth ₹8 crore produce a ₹6 crore gain before applicable adjustments, not ₹4 crore.
The example is an illustration, not a substitute for the taxpayer's facts. A change in status, period, payment mode, document, city, asset, relationship or scheme can change the result.
Search pages often state a rate or limit without identifying the governing base. The calculation must distinguish gross receipt from taxable profit, tax from TDS, a deduction from an exemption, salary from business income, and an accounting entry from the tax treatment.
| Decision point | Required treatment |
|---|---|
| Legal year | Use the Act, rules and notification effective for the income or transaction period |
| Taxpayer category | Confirm residence, age, entity, employee/business status and regime |
| Calculation base | Use the statutory definition rather than CTC, net bank receipt or accounting label |
| Ceiling or rate | Apply actual-amount, percentage, shared, lifetime and gross-income limits in sequence |
| Documentation | Link every input to an invoice, statement, contract, certificate or official record |
| Final output | Show tax, surcharge, cess, interest and TDS/TCS credits separately |
This page is written around the entities and concepts search engines expect for the topic: goodwill, slump sale, section 77, fair market value, net worth. They are used only where relevant and are connected to the live calculator and knowledge hub rather than repeated mechanically.
For the complete rules on this topic, see the core guide: Goodwill Tax on Business Sale: Cost, Gain and No Depreciation.
See the broader Income-tax Act 2025 study guide hub for related rules and calculators on this topic.
For a slump sale, fair market value determined under the prescribed rule is deemed consideration and net worth is deemed cost. Revaluation is ignored, and an accountant report is required before the specified date.
Finin2min rule: establish eligibility, calculate transparently, and preserve an audit trail.
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