Capital gain

Tax queries 491 views 7 replies

babugr

dgm

515 Points Joined February 2014

Kindly advise me the tax implication for me on the following:

I sold my residential property in Jan'14, the property was purchased by me in 1996. the proceeds against the sale of the property was deposited in my bank through RGTS transfer and a cheque. with the proceeds and my own savings I purchased a new residential flat in Feb'14 at much higher rate (2 times). I do not have any other house except the new house which was registered in Mar'14. the property was in south, whereas my income is from Delhi.

Till now I am filing ITR-1 as a salaried person. Do I have to file ITR-2 considering capital gain. I was also told that the sale proceeds should be deposited in capital gain a/c in the bank which I did not.

How to avail tax benefit for the capital gains under section 54.

thanks

babu

Replies (7)

Tribhuvan Aditya Singh

Student as well as Self-employed

3710 Points Joined September 2007

yes, you are reqd. to file itr-2 giving details of your capital gain and exemption thereof. since you have purchased a residential house and invested the whole of capital gain arising from sale of property in the new house, so you dont need to deposit any amt. in capital gain a/c. it is enough to claim exemption u/s 54 that you have purchased another house property and that you dont own any house other than the house purchased.

Tribhuvan Aditya Singh

Student as well as Self-employed

3710 Points Joined September 2007

location of property and person earning is never a problem as far as both are within india. so by earning in delhi and buying a property in south does not have any effect on exemption u/s 54.

Mihir

Wealth Manager

5293 Points Joined December 2008

Agree with Mr. SIngh.

babugr

dgm

515 Points Joined February 2014

thanks Mr.Singh, a great relief

babugr

dgm

515 Points Joined February 2014

further to my query on capital gain, there was a minor error that i sold the old house in Feb'14 and purchased the house in April'14 (registration done in 3rd week april'14 not in March as I erroneously mentioned) does it change the status of your response.

babu

Tribhuvan Aditya Singh

Student as well as Self-employed

3710 Points Joined September 2007

there will be no change in my answer because sec. 54 requires you to invest in new property within 2 years of date of transfer whereas in your case it is just matter of months.

subhash kumar jha

PROFESSION

445 Points Joined August 2012

Yes you will have to file ITR-2 so that all detail about capital gain and exemption under section 54 will exist.Keep in mind that to take exemption under section 54 it is irrelevent that wheather assessee owns any property or not means evenif assesee owns 1 or 2 or 3 or number of HP , exemption will still available.