Capital Gains Tax on amt received in Installments from sale

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  1. Venkatramana C

    Venkatramana C New Member

    Sir, .

    I have a query pertaining to capital gain account. If the buyer of my property is paying the installments in tranches and if the complete registration is not done, what is the period determined to compute taxation year and also what is the time frame provided to invest in CAPITAL GAIN ACCOUNT scheme (or) invest the proceeds in CAPITAL GAIN BONDS under Section 54EC. Kindly clarify
     
  2. gaurav_kumar

    gaurav_kumar Well-Known Member

    In such a case, the sale date would be considered as the date on which the registration is done.

    And the period for reinvestment would be considered from the date of registration.
     
  3. Venkatramana C

    Venkatramana C New Member

    Thank you for the reply sir. I am right in saying that if the sale date happens to be on 22 Feb 2015, then the registration date is 22nd feb 2015.
    What is the period of reinvestment?? can you clarify Mr.Gaurav kumar. thanks
     
  4. gaurav_kumar

    gaurav_kumar Well-Known Member

    The period of reinvestment is different for claiming capital gains exemption under different sections of the income tax act.

    The reinvestment period under section 54EC for purchase of bonds is 6 months and therefore you can reinvest this amount till 22 August 2015
     
  5. V K Khanna

    V K Khanna Active Member

    Dear Mr Kumar,

    Since in Mr Vekataramana's case, the sale has been completed in Feb 2015 and the period for reinvestment of sale proceed for claiming the capital gain exemption is available to him till Aug 2015, will the assessee have to report the transaction about sale of the property in his return for the Assessment Year 2015-16 or after purchase of bonds under Sec 54EC after !st April in his return for the AY 2016-17
     
  6. gaurav_kumar

    gaurav_kumar Well-Known Member

    @V K Khanna : He would be required to report about the sale in his income tax return.

    If he invests in the specified bonds before filing income tax return - he would be required to report that as well.

    If he does not invest in the specified bonds before filing income tax return - he would be required to deposit the amount in the Capital Gains Account and mention in his income tax return that the amount has been deposited in the Capital Gains account.
     
  7. V K Khanna

    V K Khanna Active Member

    Thanks Mr Gaurav. Your reply to my query is very clear and appropriate.
     
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