Tax relief u/s 54F for second house

Sec 54F is applicable on capital gain on long term on transfer of asset ,other than a residential house.

If you have sale any aforesaid capital asset , the gain arising from transfer , need not to pay tax on it provided that.

If you have purchased a residential house one year before or two year after the transfer. Or constructed a house with in 3 year after construction..

Please note that there is 3 year lock in period for the same.

In our case.. I believe there is no sale of long term asset capital gain, therefore 54f not applicable.. or provide the details of any transfer has been done..

Hope this will serve your purpose.

Incase you need further assistance

please contact deepakrathore.8888@gmail.com

Exemption u/s 54F is not available in respect of transfer of a long term asset, which is not a residential house. Hence, in your case, you cannot avail the benefit u/s 54F, as your house is a residential house.

In your case, you can explore the exemption u/s 54 or 54EC, subject to fulfillment of conditions specified therein.

Sir first of all you can avail of tax relief U/s.54F. But in your case you have not specified when you have sold the land on which capital gain was arrived.

Also you have invested in 2006. May I know which is the year in which you need guidance as 2006 income tax returns cannot be filed now.

Kindly be more specific to guide you better.

Dear Tax Payer,

It is not very clear that which asset was being sold. Is it Land or your self occupied house?

While the capital gain out of sale of land which is reinvested in a residential house property is covered under the provision of Section 54 of the Income-tax Act, 1961, capital gain out of sale of self occupied house which is reinvested in an another residential house property is covered under the provisions of Section 54F of the Income-tax Act, 1961.

Step to decide taxability

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1. Decide whether Section 54/54F is applicable based on the above provision.

2. Determine whether the conditions laid down in those particular sections have been fulfilled.

3. Determine the tax liability.

Provisions are different for Section 54 and 54F. Hence, due to lack of clarity in the query, leaving the answer with procedure.

Regards,

CA. Rajeev P T

Partner

Rajan Chakravarthy & Associates, Chennai

Email: ca.rajeevpt@gmail.com

*****This Opinion is based on stated facts and the legal position as on date. The views expressed may not be relevant where there is any change in facts or law. This Opinion is not in the nature of an assurance that an alternative view or interpretation cannot emerge.