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LTCG exemption

Tax queries 777 views 3 replies

Dear friends,

a residential house is sold  by two assessees being the joint owners of the property.  For availing benefit under Section 54, what should they do :

1.  Can they invest the LTCG in two different house properties, both the properties booked in joint names?

2.  If no, which property would be eligible for claiming benefit under Section 54?  Is it the option of the assessees?

regards

manish

Replies (3)

AS PER MY OPINION

 

BOTH THE PERSONS MAY INVEST IN OTHER HOUSES SEPRATELY

BUT THE INVESTED AMOUNT SHOULD BE MORE THAN THE DIFFRENCE AMOUNT, WHICH THEY GOT AS BENEFIT/GAIN

 

& FOR GETTING THE BENEFIT OF SECTION 54 THEY HAVE TO PURCHASE RESIDENTIAL HOUSE ONLY

 

AND TILL THE TREATMENT OF UNUTILISED AMOUNT

DEPOSIT IN CAPITAL GAIN ACCOUNT SCHEME UPTO DUE DATE OF FURNISHING THE RETURN OF INCOME

 

AND PRESCRIBED PERIOD FOR INVESTMENT IS TWO YEARS AFTER THE DATE OF TRANSFER

Hi

The gain is divided between joint owner as per their ownership percentage.

They can invest the LTCG in two different house properties, both the properties booked in joint names but the acuisition cost should not be less than the amount of Capital gain.

or

They both can invest their Capital Gain amount differently  in different house properties to take the exemption u/s 54.

HI DEAR,

 

CAPITAL GAIN SHOULD BE WORKED OUT FOR PROPERTY AS THERE IS NO CO-OWNER. AFTER FINDING OUT THE CAPITAL GAIN, IT SHOULD HAVE TO BE DIVIDED AMONG THE CO-OWNERS IN THE AGREED SHARING RATIO.

 

BOTH THE CO-OWNERS WOULD TAKE THE BENEFIT OF SECTION 54 BY INVESTING IN OTHER RESIDENTIAL PROPERTY FOR 2 PERSON SEPERATELY. BENEFIT OF SEC 54 AVAILABLE ONLY IF ASSESSEE PURCHASE WITHIN PERIOD OF 2 YEARS, CONSTRUCT WITHIN PERIOD OF 3 YEARS ANY OTHER RESIDENTIAL PROPERTY IN ACORDANCE WITH SEC 54.

 

IF PROPORTIONATE SHARE OF CAPITAL GAIN REMAIN UNINVESTED, THEN ON OR BEFORE THE DUE DATE OF FILING OF RETURN, ASSESSEE HAS TO DEPOSIT SUCH AMOUNT IN SCHEDULED BANK UNDER THE CAPITAL GAIN ACCOUNTS SCHEME. IF THE AMOUNT REMAINS UNUTILISED IN SUCH BANK A/C AFTER 3 YEARS, IT WILL BE DEEMED AS LTCG AND CHARGEABLE TO TAX ACCORDINGLY.

 

 

REGARDS,

 

MANOJ


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