Income Tax
This query is : Open
10 January 2021
I would like to clarify the following
Whether exemption U/s 54 available in case reinvested in housing plot (Vacant Site) ?
(to the extent of capital gain arrived Out of the sale proceeds of Vacant housing plot )
i.e. Ms. Kavitha got some Vacant land through inheritance in April .2018 (Which was originally bought by her Grandfather in 1986) and the same has been sold out in Dec.2019 . She reinvested the Capital gain portion only in Housing site and start the construction of the house through another one builder in Dec.2020. Whether this can be claimed as an exemption U/s 54?
What will be the impact in case she just reinvested the capital gain in Vacant housing site and not start any construction within 3 years from the date of property sold ?
Whether exemption U/s 54 available in case reinvested in housing plot (Vacant Site) ?
(to the extent of capital gain arrived Out of the sale proceeds of Vacant housing plot )
i.e. Ms. Kavitha got some Vacant land through inheritance in April .2018 (Which was originally bought by her Grandfather in 1986) and the same has been sold out in Dec.2019 . She reinvested the Capital gain portion only in Housing site and start the construction of the house through another one builder in Dec.2020. Whether this can be claimed as an exemption U/s 54?
What will be the impact in case she just reinvested the capital gain in Vacant housing site and not start any construction within 3 years from the date of property sold ?
10 January 2021
in case of construction, the construction should be completed within 3 yrs from the date of transfer. Therefore, she can claim exemption u/sv54
10 January 2021
If the exemption is claimed but the construction is not completed, the capital gains exempted earlier will be chargeable to tax as long term capital gains
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