|
Who can claim exemption
|
An individual or a Hindu undivided family
|
|
Which specific asset is eligible for exemption
|
If a residential house property (long-term) is transferred
|
|
Which asset the taxpayer should acquire to get the benefit of exemption
|
Exemption is available if another residential house is purchased or constructed
|
|
What is time limit for acquiring the new asset
|
Purchase – Residential house can be purchased within 1 year before transfer or within 2 years after transfer.
Construction – Residential house can be constructed within 3 years from transfer.
In the case of compulsory acquisition, these time-limits shall be determined from the date of receipt of compensation (original or additional)
|
|
How much is exempt
|
Investment in the new asset or capital gain, whichever is lower.
|
|
Is it possible to revoke the exemption in a subsequent year
|
If the new asset is transferred within 3 years of its acquisition exemption will be taken back. For calculating capital gain on transfer of new asset, cost of acquisition will be calculated as (original cost of acquisition – exemption availed under section 54).
|
The tax payer can acquire the new asset by withdrawing from the deposit account. But the new asset should be acquired within the above mentioned time-limit mentioned. If the deposit account is not fully utilized for acquiring the new asset, the unutilized amount [but in case of section 54 and 54F when the 3- year time limit expires], will be taxable as short-term/long-term capital gain depending upon the original capital gain. The unutilized amount can be withdrawn by the tax payer after the expiry of the aforesaid time-limit. If the tax payer dies before the expiry of specified time-limit (for making investment in the new asset), then unutilized amount paid to the legal heirs is not taxable in the hands of recipient.
|
Residential house property situated in Delhi
|
Mr. Sinha
Rs.
|
Mr. Goyal
Rs.
|
|
Date of transfer of the property
|
July 10, 2011
|
September 19, 2011
|
|
Date of purchase of the property
|
October 6, 1984
|
April 10, 1983
|
|
Sale consideration received
|
18,00,000
|
14,50,000
|
|
(Stamp duty value)
|
(20,00,000)
|
(17,50,000)
|
|
Cost of acquisition
|
50,000
|
90,000
|
|
Expense on transfer
|
10,000
|
6,000
|
|
Date of Purchase
|
December 20, 2011
|
March 1, 2011
|
|
Cost of acquisition
|
20,00,000
|
16,00,000
|
|
Sale consideration (i.e., stamp duty value)
|
20,00,000
|
|
Less:
Indexed cost of acquisition [Rs. 50,000 X 785 / 125]
|
3,14,400
|
|
Expenses on transfer
|
10,000
|
|
Balance
|
16,76,000
|
|
Less: Exemption under section 54 [amount of investment in new residential property, i.e., Rs. 20,00,000 or amount of capital gain, i.e., Rs. 16,76,000, whichever is lower]
|
20,00,000
|
|
Long-term capital gains chargeable to tax for the assessment year 2012-13
|
NIL
|
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