CAPITAL GAIN TAX

Tax queries 143 views 2 replies

NITIN

Others

23 Points Joined December 2014

I have following doubts on LTCG tax.

1. If I have 3 residential properties. Can I sale 2 properties to buy 1 residential property and save tax under section 54.

2. What if the LTCG gain from sale of 2 properties exceed 2cr.

3. Can I sale one property in this fin. year and pay capital gain tax or save under 54EC and sale 2nd property in next fin. year and invest in another property and save tax under sec.54.

4. can I invest in 54EC 2 times in 2 financial years. Can the total investment under 54EC in twof inancial years exceed Rs.50 lakhs.

Replies (2)

Kapadia Pravin

17264 Points Joined December 2018

1. Yes
2. New property value to be more than 2 crore for 54 section benefit
3. Yes you can do that
4. Yes sure No problem in 54EC - 50 + 50

1. The new amendment will take effect only from 01.04.2020 and there is no specific explanation about the sale of two residential house property.
2. In your case, if you have sold two residential house property and sale proceeds are allowed to be invested only in one residential property whether constructed or purchased within the stipulated years.
3. With respect to investment in sec 54EC, it will be allowed to be invested only one time in an FY and restricted to one residential house property.
4. The option available to you is (4), where property 1 can be sold in a year and sale proceeds can be invested up to Rs. 50 lakhs in Sec 54EC bond and another year property 2 can be sold and invested in sec 54EC bond up to Rs. 50 lakhs. However, you should be careful in while making the investment to make sure that investment does not fall in the same FY.
Please correct me if the above solution has an alternative view.