Long term capital gains

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Parsi (Querist)

08 June 2012 Hi,
We will be selling a plot of agricultural land near Kolkata and want to avoid LTCG tax. What is the minimum amount of the net proceeds of the sale that need to be invested in purchase of residential flat under section 50f to avoid LTCG tax and what amount of the tax will be avoided. can someone also please specify other methods of saving on long term capital gains tax.

Thank You.

Ca Anand Dubey

Ca Anand Dubey (Expert)

09 June 2012 u/s 54f amount equal to capital gain

CA Rajendra Purohit

CA Rajendra Purohit (Expert)

09 June 2012 First of all make sure whether your land comes under municipal limits of kolkata or not. If it does come then you will be charged to capital gain if any arise. To save your self from paying tax on long term capital gain you have the option of Section 54F where the amount of capital gain invested in the residential property will help you to save the tax on LTCG. Second option is NHAI bonds in which you can invest 50 lacs per financial year but make sure you invest in the bonds within 6 months from the date of sale of your land. You can also arrange in such a way that you can invest 1 crore in such bonds. Interest in taxable of such bonds. Apart from this if you have any long term capital loss then you can set off that against it, if any.

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