1) A property has been sold by Mr X , can he claim capital gain exemption for the same by purchasing another also note that he has two more properties in his name.
2) What are the tax implication if he does real estate business i.e., selling and buying with those properties ( holding for more than 3years)?
1) in the first case he cannot obtain exemption by purchasing another house property. I think only way to save tax is by buying the NHAI or REI bonds.
2) In case he is in real estate business then it will become this business income and not under capital gains.
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u/s 54 long term capital gain from transfer of flat shall be exempt to the extent such capital gain is invested in the purchase of another flat within one year before or 2 years after the date of transfer and is not transfered within a period of 3 years from the date of its acquisition.
Agreed with Mihir
a) he cn claim exemption u/s54
b) no capital gain exemption available as the profits will be under head P/G/B/P
| Originally posted by : Amit Gupta | ||
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a) he cn claim exemption u/s54 b) no capital gain exemption available as the profits will be under head P/G/B/P |
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aggred
agree with mihir & pravin
WHY EVERY PERSON TRYING TO TELL HIS OWN ANSWER WHEN INCOME TAX SECTIONS TELL SOME OTHER THING. I REQUEST TO ALL ABOVE GUYS PLEASE READ SECTION CAREFULLY AND THEN REPLY.
THE ANSWER IS
(1) THE ASSESSEE WILL NOT ELIGIBLE FOR EXEMPTION THAT HE HAS ALREADY TWO PROPERTY (Refer supreme court judgement)
(2) If assessee is engaged in real sector then no capital gain tax attract to him. but if he is giving property on rent still his income will be considered as business income not house property income. this assessee will not be eligible for depreciation. (Refer latest case laws).
YES,HE CAN CLAIM EXEMPTION,
IRRESPECTIVE OF THE NO. OF HOUSES HELD BY HIM :
1) AS PER SEC54 OF INCOME TAX ACT 1961, INDIVIDUAL & HUF CAN CLAIM EXEMPTION OF CAPITAL GAIN IN CASE A HOUSE (LONG TERM CAPITAL ASSET) IS SOLD & NEW HOUSE IS PURCHASED 1 YEAR BEFORE OR 2 YRS AFTER THE DATE OF TRANSFER OR THE CONSTRUCTION OF THE NEW HOUSE WITHIN 3 YRS.............................
2) IF HE DEALS IN REAL ESTATE, HIS INCOME WILL BE TAXABLE U/H PROFITS & GAINS OF BUSSINESS & PROFESSION. SO, HE CANNOT CLAIM EXEMPTION.
@ hardik : the condition of already havin a house is applicable u/s 54F not 54 wherein House property is sold
my dear friend AMIT GUPTA
i appreciate your ranswer but u little far from correct understanding. 2 house hold is applicable to both sections. section 54 not dealing with number of house where section 54f dealing with 2 house. I hope u understand it.
CONTACT ME @ ashvin_bhanderi @ yahoo.co.in FOR BETTER REPLY...
| Originally posted by : srishty mittal | ||
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YES,HE CAN CLAIM EXEMPTION, IRRESPECTIVE OF THE NO. OF HOUSES HELD BY HIM : 1) AS PER SEC54 OF INCOME TAX ACT 1961, INDIVIDUAL & HUF CAN CLAIM EXEMPTION OF CAPITAL GAIN IN CASE A HOUSE (LONG TERM CAPITAL ASSET) IS SOLD & NEW HOUSE IS PURCHASED 1 YEAR BEFORE OR 2 YRS AFTER THE DATE OF TRANSFER OR THE CONSTRUCTION OF THE NEW HOUSE WITHIN 3 YRS............................. 2) IF HE DEALS IN REAL ESTATE, HIS INCOME WILL BE TAXABLE U/H PROFITS & GAINS OF BUSSINESS & PROFESSION. SO, HE CANNOT CLAIM EXEMPTION. |
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Agreed
@ hardik - which case law you are talking about. please mention here.
Please mention the wordings of Act for 54 where it says exemption is not granted .... from where you have read
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