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Capital Gain related

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PRAVINDRA CHOUDHARY

7 Points Posted on 30 August 2020

I sold agriculture land (urban) in which 10 lacs arises as capital gain, can I get exemption on it if I purchase residential house from that amount ?

Replies (2)

Quick Summary

If you've sold urban agricultural land and made a capital gain, you may be able to claim an exemption under Section 54F of the Income Tax Act. This exemption applies if you reinvest the full sale proceeds into a residential house property within specific timeframes. Key conditions include purchasing or constructing the new property within 1-3 years of the sale, owning only one other property at the time, and not selling the new property for three years. Ensure you invest before filing your tax return or deposit the funds into the Capital Gains Account Scheme.

Sagar Patel

Tax and Business Consultant

11616 Points Posted on 30 August 2020

Yes, You can claim Exemption u/s 54F for Long term Capital Gain if you invest full Consideration received (total sale Amount) in new residential house property subject to conditions of Section. 54F Of Income Tax Act, 1961
1. investment is made within a period of 1 year before or 2 years after the date of transfer; or Construction within 3 years.
2. Assessee own only One house Property at that time other than this new property.
3. Can't sale New house property within 3 years.
4. Invest before filing return, otherwise deposit amount in Capital Gain Account scheme and than invest within time prescribed.