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Very urgent

CA.Sonia (professional) (517 Points)

15 March 2010

Mrs.X has income from pension of Rs.85000 and long term capital gain of Rs.3.5 lakhs n sale of a plot and want to know whether fixed deposits which have been renewed for a period of 1 yr can be claimed as a deduction?

2. How to save Long term capital gain tax bkz already Mrs.X hold a resdential house property.

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8 Replies

nikhil.r.gondhalekar (articled assistant) (64 Points)
Replied 15 March 2010

Hi,

1)LTCG will be taxed @ 20% .but unabsorbed exemption limit is avialiable if Mrs X is resident

2)No.FD for 1 year is not tax saving insrument

3)invest capital gain in NHAI bond.refer NHAI site.Investment wihin six month

-Regards

CA.Sonia (professional) (517 Points)
Replied 15 March 2010

Can you give any other investment option apart from NHAI Bonds?

C.Balaji (Learner) (1867 Points)
Replied 15 March 2010

Dear Sonia..........

Ded u/s 80C - Fixed Deposits in a bank not less than 5 yrs........

LTCG from sale of Plot therefore, the sections applicable here are 54F and 54EC.........

54F talks about Transfer of Capital Asset (Long Term) other than Res. house and pur / const. of Res. house............ The Assessee should not own more than One Res. hosue........

54EC - Transfer of LTCA and investment in Specified Assets....i.e. REC and NHAI bonds.....within six months from the date of transfer......

Amir (Learner) (4016 Points)
Replied 15 March 2010

Dear Mam,

Chapter VI A cannot be claimed in respect of Long Term Capital Gain.

As Balaji Bhai has right mentioned that FD shuld be of minimum 5 years. bu making FD for 5 years the pension of 85k can be reduced to Nil.

Further Entire exemption limit can be utilized if the status is of Resident.

Sec 54F & 53EC can be availed.

Any brought forward Capital Loss can also be adjusted.

SUDHIR & PRADEEP JI (CA FINAL+LLB + DISA) (2299 Points)
Replied 15 March 2010

agree with amir

Sharad Suman Das (art) (141 Points)
Replied 16 March 2010

Dear Mam,

in your case if Mr. X was a governent employee then the amount of pension recieved by him will be fully exempt from tax

Further, if you want to save capital gain fom sale of land Then as per Sec 54 EC you can invest entire amount in Either NHAI or Rural Electrification Ltd.

Chapter VI A cannot be claimed in respect of Long Term Capital Gain

FD shuld be of minimum 5 years.

Prasanth Nair V (ACA,ACS,CWA Final,Mcom) (557 Points)
Replied 16 March 2010

Hi, Exemption under these two section can be claimed,

U/S 54EC & 54F- These two are the only two options available...

Balaji (Knowledge Seeker) (317 Points)
Replied 16 March 2010

Dear Sharad,

To the best of my understanding,the Pension received would be taxable even for a Govt. employee.For example, if a retired Central Govt. employee receives pension, would it be tax-free?If so,under which section?

As usual, Amir has given the best solution covering every aspect.