LTCG - HOUSE PROPERTY

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If you're selling your current home and planning to buy a new one within three months, you can keep the sale proceeds in your existing bank account. There's no need to open a separate account. You generally have up to two years to buy or three years to construct a new property to qualify for Capital Gains Tax (LTCG) relief under Section 54. If you don't invest the gains by your Income Tax Return (ITR) filing deadline, you must deposit them into a capital gains deposit account.

Deepak Walia

Deepak Walia (Querist)

30 May 2021 I AM GOING TO SELL MY PRESENT HOUSE PROPERTY VERY SOON. I WILL ALSO BUY A NEW HOUSE PROPERTY SOON SAY WITHIN THREE MONTHS TIME.
SHOULD I KEEP PURCHASE CONSIDERATION RECEIVED FROM OLD PROPERTY IN MY PRESENT BANK ACCOUNT OR I NEED TO OPEN A NEW SEPARATE BANK ACCOUNT FOR THIS PURPOSE.
I NEED TO SAVE MY LTCG U/S 54.
WHAT SHOULD I DO! PLEASE ADVISE ME.

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)

30 May 2021 Keep it in present bank account in view of new house purchase in 3 months.

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CMA Poornima Madhava

CMA Poornima Madhava (Expert)

31 May 2021 No need to open a separate account. You have time to buy/construct the new house within 2/3 years respectively. However, if investment is not made within the due date of filing ITR then such gains have to be deposited in a capital gain deposit account. In this case, since the sale is being made during this FY, time limit to invest would be before due date of ITR for FY21-22 (next year).

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