Tax exemption on short term capital gain from property sale


Prashant (abc)     11 June 2015

Prashant
abc 
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Hello, I have sold my property and have some amount(for ex:40 lacs) as capital gain. Now I am investing 20 lacs in new property, rest is loan amount. And I plan to deposit the remaining amount in SBI maxgain account of the loan of the same property. Can I get tax exemption on this short term capital gain by investing/depositing the remaining amount in SBI maxgain loan account? Regards, Prashant.

Milind (Engineer)     15 July 2015

Milind
Engineer 
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Hello Prashant,

Your question lacks clarity...as far as gains from sale of property goes the capital gains concept is as follows:

1. If property is sold within 3 years then short term gains is applicable and the gains becomes part of your total taxable income and is taxed at the slab rate applicable to you...there is no way you can get exemption from these gains

2. If property being sold is after 3 years then long term gains is applicable and you can get exemption from it by 

 - buying another property

 - buying capital gains bonds (NHAI and REC)

Buying SBI maxgain bonds will not give you exemption . Also if there is any amount left after buying the property then that that amount will be taxable for long term capital gains

 

 

avater

Prashant (abc)     15 July 2015

Prashant
abc 
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Hi Milind,

 

Thanks for clarifying.

The date of registration of property is 04th April 2010 & date of sale is 22nd May 2015.

So this shpould be Long term Capital gain... correct??

Milind (Engineer)     15 July 2015

Milind
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Yes it is long term capital gains.

You need to invest "only" the gains in buying a new residential property or buy bonds (NHAI/REC)

.

avater

Prashant (abc)     16 July 2015

Prashant
abc 
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OK, thanks for the info.

Some more query related to this.

1. I have made this long term gain out of a property sale which was registered in myself and my Mother's name.

Can I invest in a property which will be registered in myself and my wife's name??

2. Also some amount from that gain is paid to my mother's account, so who will n=be taxed for this amount??


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