Surrender of LTCG under section 54F

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

09 September 2010 Dear Experts,

I claimed exemption under section 54F in return filed in June 2009 for a residential unit purchased in May 2008. I sold it due to personal reasons in July 2010 i.e before 3 years. I understand that I will have to surrender the LTCG exemption that I claimed.

Please advise when do I have to pay the claimed exemption? Do I have to pay in march 2011 or before? Please advise

SANJAY TALATI

SANJAY TALATI (Expert)
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09 September 2010 The Exemption of LTCG in respect of the sale of residential unit is u/s 54 and not u/s 54F.

Any way, as u have sold the newly purchased residential house property before the expiry of 3 years, and therefore, the exemption allowwed earlier would be taxable. Hence, the capital gain which arises on the transfer of the house would be computed as under :

Sale Consideration
Less : Cost of Acquisition
of the Trfd. house as reduced by the
the exeption granted earlier.

This is the STCG of the previous yer of sale and u have to show in the IT return of the year of sale of house and plan to deposit the tax accordingly.

Querist : Anonymous

Querist : Anonymous (Querist)

09 September 2010 Thanks Mr Sanjay.

Pls specify if the tax to be surrenderred can be deposited in march 2011 or do I have to deposit in advance tax form i.e in sep / dec and Mar in installments.

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