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Long term capital gain on sale of second flat

Tax queries 183 views 6 replies

K P BHANUSHALI

PROPRIETOR

563 Points Joined January 2010

Hello Friends,

I have one query regarding Sale of Second House owned singly by Senior Citizen.

Instalments for Payment towards Second Flat was started from 24.04.2010 & Completed on 3.11.2018. Total Purchase Cost is 1293199/- & Indexation of this total cost comes to 1866616/-. There by LTCG comes to 683384/-. Possession of the Flat was given by builder on 8.6.2014 & this flat was subsequently given on Rent.

Sale price of this flat is 2550000/-.

What will be position as far as Taxability of this LTCG is concerned.

Whether he can buy another Flat to avoid LTCG Tax and if he can, upto what amount he should invest in new flat ?

T & R

K P Bhanushali

Replies (6)

Sayan Gupta

Accounts Professional

176 Points Joined August 2016

If he utilises the proceeds equivalent to the LTCG amount towards purchasing another new complete flat within India within 1 year prior to the sale date or within 2 years after the sale date, then he can save the entire tax. Points to be noted that in case of under construction flat the time period given is 3 years means it has to be complete within 3 years after the sale date.