Nnnsection 54 of income tax act pdf

Investment made in purchase or construction of a new residential house property. But this planning is nullified by the second proviso us 54ec. Costs for purposes of section 81 of the income tax act 58 of 1962 fixing of rate per kilometre in respect of motor vehicles for the purposes of section 8bii and iii. The amount of exemption under section 54 of the income tax act for the longterm capital gains will be the lower of. Section 54 of income tax act capital gains exemption cleartax.

Exemption available under section 54 of income tax act taxguru. Finance act 2018 also provide that if the assessee transfer longterm specified asset or takes any loan or advance on the security of such longterm. Hence, the balance capital gains if any will be taxable. In order to claim the exemption, the assessee is required to reinvested the amount towards purchasing or constructing new residential house property. Section 54 income tax act capital gains exemption chart. He will be eligible to claim deduction under section 54 of the income tax act 1961 provided he acquires coownership rights in the new flat. Section 54 to 54 h chart income tax this is the summary of different sections of income tax act for easier understanding and rememberance. Section 54 and 54f of the income tax act are independent of each other while delivering the decision, the tribunal observed that a reading of sections 54 and 54f make it clear that they are independent of each other and operate with respect to longterm capital gain arising out of the transfer of distinct and separate longterm capital assets. Long term capital gains tax saving can be done for residential house. Exemption available under section 54 of income tax act. The exemption under section 54 of the income tax act can be claimed in case of long term capital gain arising on sale of residential house property.

The section 54 of the income tax act allows the lower of the two as exemption amount for a taxpayer. In the income tax appellate tribunal d bench, mumbai. Capital gain on transfer of land used for agricultural purposes not to be charged in certain cases. The term capital asset is defined under section 2 14 of the income tax act, 1961 which includes property of any kind movable or immovable. Income tax act 90 of 1988 income tax amendment act 99 of 1988 income tax act 70 of 1989. What are the provisions relating to the transfer of property. Capital gains arising on transfer of residential house. Click to view the institutions registered under section 80g, 12 a and more. As shown in example, assessee has tried to take double benefit of section 54ec by investing the amount in two different financial years but within six month after the date of transfer. Subsequently the finance act of 1956 widened section 12 b to bring within capital gains any profits or gains arising from the sale. If in this case the seller was liable to pay incometax on capital gains arising on sale of old house, then it would be a hardship on him.