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Section 54f exemption for a new house with one self occupied

Tax queries 468 views 1 replies

K. meharnath

prop

141 Points Posted on 23 September 2014

Hi,

1. My wife has a self occupied house in Bangalore, and she intends to buy one more house with capital gains that has been realised this financial year 2014-15. Will the latest amendment in the tax laws stating that the exemption is for only ONE HOUSE, Is it that from this financial year onwards it is ONE House or if she has already an owner of a residential house, will she get or not get the exemption for this FY 2014-15.

2. If i have gifted one house property to my wife (I am the deemed owner), and she sells that house property, can she invest in capital gains 54EC bonds and claim 50lac exemption. I am also taking that exemption this financial year from one more house property. Together we propose to take 100 lac exemption. Will the deemed owner status affect the investment in 54ec bonds or it is only for the INCOME derived only

Replies (1)

CS Advocate Abhishek Goyal

M Com FCS LLB M-AIMA

14046 Points Posted on 26 September 2014

1. Since your wife is already an owner of a residential house property she cannot claim exemption for buying one more house u/s 54F since as per the section on the date of transfer the assessee must not have any other residential house property other than the new one. However there is no such condition in section 54 therefore if residential house is to sold and another one is to be purchased than section 54 can be availed provided the investment is made in only one house.

2. Yes the wife can claim section 54EC benefit.