Long term capital gains benefits

Tax queries 1082 views 2 replies

M Srinivasa

Manager

28 Points Joined July 2011

I built a house 2 years back and the construction was incomplete due to funding issues. I have a Home Loan of Rs 8 lakhs on it, for which I have so far not availed any income tax deduction benefits.

I sold a non agricultural land recently for Rs 16 Lakhs, and am now planning to complete the construction of the house by also adding additional rooms.

Can I offset some of my Capital gains arising out of the plot sale against the expenditure already incurred on the incomplete house, and also for the remodelling of the house?

regards,

Srinivasa M

Replies (2)

Prateek Agarwal

Sr. Executive - Finance & Accounts

1732 Points Joined February 2011

Hi Mr Srinivasa,

Your case falls u/s 54F.

You have purchased the house 2 years back. It is not attracting the exemption provision since for exemption it is 1 year back or 2 Years Forward.

For construction purpose, it is 3 years from the date of transfer.

Remodelling is not treated as construction.

So, i think you cannot claim / offset your cap gains into remodelling of your house.

Regards

Prateek

Roopwant Soni

Chartered Accountants

32 Points Joined October 2007

No way..as the time limit to complete the under conctructed house has gone for now...howvere if u want u can go for other means like Cap Gain depositing scheme...etc.