Nnnsection 54 of income tax act pdf

Hence, the balance capital gains if any will be taxable. As shown in example, assessee has tried to take double benefit of section 54ec by investing the amount in two different financial years but within six month after the date of transfer. Sections 54, 54f deductions available only for ltcg. What is the amount of exemption available under section 54 of the income tax act. Exemption under section 54 can be claimed in respect of capital gains arising on transfer of capital. But this planning is nullified by the second proviso us 54ec. Section 54 income tax act capital gains exemption chart.

Section 54 gives relief to a taxpayer who sells his residential house and from the sale proceeds he acquires another residential house. Investment made in purchase or construction of a new residential house property. The term capital asset is defined under section 2 14 of the income tax act, 1961 which includes property of any kind movable or immovable. The section 54 of the income tax act allows the lower of the two as exemption amount for a taxpayer. Capital gains were charged to tax for the first time by the income tax and excess profits tax amendment act, 1947, which inserted, inter alia, section 12 b in the 1922 act.

Investment made for constructing or purchasing a new residential property. If in this case the seller was liable to pay incometax on capital gains arising on sale of old house, then it would be a hardship on him. The amount of exemption under section 54 of the income tax act for the longterm capital gains will be the lower of. The balance amount if any will be taxable as per the income tax act. He will be eligible to claim deduction under section 54 of the income tax act 1961 provided he acquires coownership rights in the new flat. Finance act 2018 also provide that if the assessee transfer longterm specified asset or takes any loan or advance on the security of such longterm.

Section 54 to 54 h chart income tax this is the summary of different sections of income tax act for easier understanding and rememberance. Long term capital gains tax saving can be done for residential house. In order to claim the exemption, the assessee is required to reinvested the amount towards purchasing or constructing new residential house property. Amount received as capital gains on transfer of residential property, or. What are the provisions relating to the transfer of property. Exemption available under section 54 of income tax act. The exemption under section 54 of the income tax act can be claimed in case of long term capital gain arising on sale of residential house property. Capital gain on transfer of land used for agricultural purposes not to be charged in certain cases. Income tax act 90 of 1988 income tax amendment act 99 of 1988 income tax act 70 of 1989. Section 54 of income tax act capital gains exemption cleartax. Capital gains arising on transfer of residential house. Costs for purposes of section 81 of the income tax act 58 of 1962 fixing of rate per kilometre in respect of motor vehicles for the purposes of section 8bii and iii.

Click to view the institutions registered under section 80g, 12 a and more. Subsequently the finance act of 1956 widened section 12 b to bring within capital gains any profits or gains arising from the sale. Section 54ec deduction on capital gain under income tax act. In the income tax appellate tribunal d bench, mumbai.