Cap Gains Exemption for Home Furnishings

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  1. Vanessa Mendonca

    Vanessa Mendonca New Member

    Dear Team,

    My father is 86 years and has bought a flat under the capital Gains Scheme. However he still has a balance amount left after investing in Govt. bonds.

    The flat is altogether bare and is not livable until it is furnished.

    His queries are these:
    Can he use the balance of the CG amount for purchase of furnishings for the flat?
    If yes, what are the kinds of furnishings that are allowable under the IT Act so that he is not taxable?

    Are the bills to be in a particular format ?

    The time period for the Scheme is expiring shortly and it is possible that he may not be able to get someone to complete the interiors in time in case he does not like what is readily available. In such a case can he appoint a furnisher, pay him an advance and submit the advance receipt alongwith the quotation for the filing of the tax. The work will be completed after the expiry of the Scheme period as per the quotation agreed upon.

    What are the other ways he could use up the unutilised amount apart from paying the tax?

    Look forward to hearing from you.

    Thanking you,

  2. Piyush Chawla

    Piyush Chawla Active Member

    Cap Gains Exemption can be claimed for purchase of home and construcction/ renovation of home.

    Expenses done on any immovable asset would be allowed to be claimed as an exemption. However, any expense done on movable asset like beds, sofas etc would not be allowed to be claimed as an exemption.
    Abhijit Guha likes this.
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