I do Accounting a proprietor ship firm and his profit this Financial year 50 lakh and he is want buy a home. and i want know if he is invest 40 lakh rupee new home did this amount his taxable
21 March 2017
As per Income Tax Act, tax is levied of net total income which is Rs. 50 lakhs in your case.
Exemption by way of purchasing new house is available in case there is income from capital gains, in your case income is chargeable under head business or profession, so tax is to be paid on 50 lakhs that means tax is also charged on amount to be invested in house (i.e, 40 lakhs)
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