I AM OWNER OF 1/3 RD OF A FLAT AND HAVING A LAND 2 COTTAH. NOW I AM SELLING THIS LAND AND LONG TERM INCOME IS 5.00 LAC. CAN I BUY ANOTHER OR CONSTRUCT FOR SAVING THE LONG TERM GAN TAX.
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2 Answers
As you are selling a plot, section 54F and 54EC can be used to save income tax arising on long term gains.
As per section 54F, you will have to buy another residential property within 2 years of sale of plot or construct a house within three years of sale. Buying price of new property must be more than sale price of plot, in order to save income tax fully. But there is condition that at the time of buying new property, you should not be owner of more than one property.
As per section 54, you can buy or construct property in 2 years after sell of property for the amount euual to ther profit or gain so that you need not pay any Long Term Capital Gain Tax. Otherwise you may have to pay LTCG tax on the profit you earned. Thanks Ashok
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