Question: As you mentioned in your article, long-term capital gains (LTCG) resulting from the sale of non-residential capital assets are residential assets subject to the deadline for which the sale price is stated. In this section, “For the types of long-term capital assets, see”Capital gains result from the transfer of long-term capital assets, not housing. “I had a fair amount of LTCG from a debt mutual fund in the previous fiscal year and will be the same this fiscal year. Given the above, I would like to know if I can reinvest the LTCG from debt. I’m thinking. I’ll raise money on a residential flat within the next two years. I’d also like to know if I can claim a refund of the taxes paid to LTCG in 2021-22 in the future.-P. Acharya
Answer: For the purpose of claiming tax exemption under Section 54F, all capital assets except housing are covered and individual tax exemption under Section 54 is available. Therefore, a long-term capital gains exemption from the sale of all capital assets, including the Debt Fund, can be claimed under Section 54F by investing in residential real estate within a specified time limit.
In order to claim an exemption from long-term capital gains from the sale of residential real estate, it is necessary to invest only the calculated amount of capital gains after applying the cost inflation index to residential real estate under Section 54. Please note. If you claim an exemption for long-term capital gains arising from the sale of non-residential real estate assets under Article 54F, you must invest the full amount of the net sale consideration received, not the amount of capital gains. Therefore, if you want to take advantage of the tax exemption under Section 54F, you need to invest the debt redemption income in residential real estate.
If you have already been taxed on long-term capital gains, there is no provision under the law to claim a refund of such tax, even if you buy your home within the specified time period. However, if you plan to purchase or construct a residential property within the specified time limit, you can deposit the investment amount in a bank account opened in the capital gains scheme account of the licensed bank and request an exemption at the time of application. .. ITR submitted for evaluation from 2021 to 2022. Even if you have already submitted an ITR, if you deposit the amount in the above account by September 30, 2021, the deadline for submitting the ITR for the 2020-2021 fiscal year will be extended, and the ITR will be amended and a refund will be requested. I can do it.
Balwant Jain is a tax and investment expert and can be reached on Twitter at jainbalwant @gmail and @jainbalwant.
Never miss a story! Stay connected and informed with Mint. Download the app now!
Is it possible to save income tax by investing the profits of the investment trust in the apartment?
Source link Is it possible to save income tax by investing the profits of the investment trust in the apartment?