My wife and I jointly owned a property since 2003.( Wife first name and me 2nd name). The property was under rent since possession. Wife was showing the rent under her income.
Recently, that has been sold off and capital gains, after indexation, has accrued.
We also own a property since 2014. Same joint name. Wife first and me 2nd. The flat is for own use and mostly lie vacant.
We stay in a flat that is owned by me ( singly held).
My query is, if we book / buy a flat in joint name now ( wife first and me 2nd) , will we be elligible for capital gains tax exemption under section 54? The cost of the flat to be occupied in 2024 is almost same as the capital gain. That is around 92 lacs. We propose to divide the capital gains @ 46 lacs each for my wife and me.
If the new flat doesnot qualify for capital gains exemption, then we buy Bonds under 54EC for 46 lacs each within 6 months of sale of the flat ( 28th Feb 2022) and avoid paying Capital Gains tax.
Kindly help us with the rule and clarification.
Regards and thanks in anticipation.
CAclubindia
