I recently sold my flat. Of the sale proceeds, the long term capital gains are about 19 lakhs. I own other property as well. Can I invest these proceeds in another flat or plot of land to be exempted from LTCG?
Answered on November 08, 2017
If you invest the capital gain arising from the sale of residential flat in another residential flat then the provision of section 54 of Income Tax Act shall apply (i.e selling of one residential property and purchasing another residential property within within 1 year before or 2 years after the due date of transfer of the Property sold or construct a residential house property within a period of 3 years from the date of sale of property).
Accordingly capital gains so arising shall be exempted. Further the new residential flat so purchased should be held by you for subsequent period of 3 years. No exemption will be allowed if you invest in plot of land. Already owning one residential flat will not have any effect on the benefits available under section 54 of the Income Tax Act.
Accordingly capital gains so arising shall be exempted. Further the new residential flat so purchased should be held by you for subsequent period of 3 years. No exemption will be allowed if you invest in plot of land. Already owning one residential flat will not have any effect on the benefits available under section 54 of the Income Tax Act.
