Section 54F: CAPITAL GAIN ON TRANSFER OF A LONG TERM CAPITAL ASSET OTHER THAN A RESIDENTIAL HOUSE
SCOPE | Transfer of long term capital asset other than residential house property by an individual or HUF |
AMOUNT OF EXEMPTION | If cost of new house > net consideration of assets transferred = full amount
If cost of new house < net consideration of assets transferred, the exemption = CG x (Cost of new house/ Net sale consideration) |
CONDITIONS |
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IF AMOUNT NOT UTILIZED TILL FILING OF RETURN U/S 139(1) | The amount of net consideration which is not utilised by the assessee for the purchase or construction of new house before the date of return shall be deposited before the due date of furnishing of return of income in Nationalized bank under the capital Gains Deposit A/c scheme. |
IF DEPOSIT NOT UTILISED | Unutilized amount taxable as LTCG in the previous year in which three years from the date of transfer of original asset expires. |
CONSEQUENCES OF TRANSFER BEFORE 3 YEARS | Amount of capital gains exempted earlier taxable as LTCG in the previous year in which new property sold. Capital gains on new property shall be computed normally. |