In view of amendment of July 2024, where properties held before that date were 'grandfathered' - meaning that these properties could take indexation benefit even if sold subsequent to July 2024. From tax angle, govt clarified that the lower of the two taxes need to be paid and a taxpayer can exercise either option which benefits him. The wordings however are that first one needs to compute under new regime, and then if under old regime the tax comes lesser, the excess tax ( calculated under new regime) shall be ignored.
However, this means relief is limited to excess tax being ignored.
But what happens if someone wants to reinvest the capital gains in a new house.
Will he have to reinvest the unindexed capital gains in the new house to claim full exemption or he can still take advantage of indexation and just reinvest only the capital gains arising post indexation?
Clarity is required on this- because there is no deptt clarification on this- and if capital gains now imply simply Sale price (minus) acquisition price+improvements, and not indexed cost of acquisition anymore, then how can we be sure abt which amount is required to be reinvested.
CAclubindia
