LTCG Tax

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This discussion clarifies Long Term Capital Gains (LTCG) tax implications when selling ancestral property. It explains how investing sale proceeds in notified infra bonds with a 5-year lock-in can provide exemptions from capital gains tax. The advice covers declaring these gains and deductions in ITR 2 under Schedule CG, specifically mentioning Section 54EC.

nirmal

nirmal (Querist)
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29 December 2020 I have received one fourth of sale proceeds of ancestral property as my share. I invested a large part of it in infra bonds. Seller has already deposited TDS @10% as per our form 26. How to show it in ITR.

KAVIRAJA ADDANGADI

KAVIRAJA ADDANGADI (Expert)
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29 December 2020 Extent notified Infra bonds with 5year locking period are exempted from capital gain , balance gain raised after indexation is taxable @20%

Interest accrued from capital gain bonds is taxed on accrual basis income from other sources along with other head of income if it exceed taxable threshold limit