Hello Sir,
My Late Father's property is sold and i got 28% of the share from the sale amount on 4th July 2019. I have planned to invest the money in the tax saving bonds. Till Auditor gives the final taxable amount, can i keep the money in FD? How long I can keep the money in FD? Please advice.
https://insuringgurgaon.com/blog/loan-against-lic-policy/
1. The above transaction will result in Capital gain tax and it will be restricted to your share in the property.
2. If you have decided to invest in tax saving bonds which is National Highway Authority of India (NHAI) and Rural Electrification Corporation of India (REC) it should have been made within a period of 6 months from the date of sale.
3. In your case, 6 months from 4th July 2019 ends on 4th January 2020. So investment should be made within this date. It would be advisable to deposit the amount into Capital Gains Accounts Scheme (CGAC) in type A account (savings) and invest the amount from there to bonds u/s 54EC. It should be noted that only the capital gain on sale of such property should be invested into bonds and not the entire sale proceeds.
4. From the above action, there will not be any problem as withdrawal from Type A account of CGCS as it has no restrictions. Interest rates are notified by RBI from time to time for this type of account.
Please correct me if the above solution has an alternative view.
CAclubindia
