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Save capital gain tax

malkesh (B.Com) (23 Points)

04 October 2020

Can we purchase the commercial property from the capital gained by selling residential property to save capital gain tax..??

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3 Replies

Sagar Patel (Tax and Business Consultant) (11611 Points)
Replied 04 October 2020

No, to save Capital Gain tax u/s 54 on selling residential property, you have to Purchase residential house property only.

ayusmita (Tax consultant) (5885 Points)
Replied 04 October 2020

No you can't but as per section 54F of the income tax you can save capital gain tax by saling a commercial property by purchasing a residential property but with in a year before or with in two years after the date of sale

malkesh (B.Com) (23 Points)
Replied 11 October 2020

Thank you friends for your advice ..

Assuming that we have invested to save long term capital gain by purchasing residence property ,
after minimum lockin period of 3 years.
if we sell the same property , on that sell , we again generate the capital , will this cycle continues ...??