tax on capital gain

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pooja (Querist)

06 May 2011 IF someone has purchased a house for Rs. 1500000 & sells it for Rs. 3000000 & it a a long term asset & he dont want to pay capital gain tax on such capital gain then how this money can be utilised or invested for saving tax under different provisions of income tax act?

CA Navin Jain

CA Navin Jain (Expert)

06 May 2011 Section 54 provides exemption on long-term capital gains arising on sale of residential property and investment of such capital gains in another residential property. The law envisages a time limit within which the investment should be made. That is two years for purchase and three years for construction. But if after the sale of the property, you cannot find another property of your choice, the amount of capital gain should be kept in any authorised bank under a Capital Gains Accounts Scheme till investment.

pooja

pooja (Querist)

06 May 2011 But sir besides this section 54 there is no other option in income tax act to save tax on this capital gain like showing this amt as expenses for son's marriage or anything else?

CA Navin Jain

CA Navin Jain (Expert)

06 May 2011 IF YOU WANTS TO SPENT MONEY ON PERSONAL USE THAN YOU SHALL NOT TAKE ANY BENEFIT UNDER INCOME TAX ACT

pooja

pooja (Querist)

06 May 2011 sir please advice any tax planning in respect of this capital gain besides section 54 exemption.

Sunil Kr. Sanganeria

Sunil Kr. Sanganeria (Expert)

06 May 2011 You can save tax by Investing in bond issued by NHAI or by REC.

Maximum Investment in these bonds is 50 lacs and investment has to be made within 6 months from the date of transfer.( Section 54EC)

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