Exemption under Section 54 but property sold in 3 years

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  1. hagarwal

    hagarwal New Member

    Dear Sir,

    I have recently purchased a house after selling off a plot and claimed capital gain exemption under section 54f. Now due to some unavoidable circumstances I need to sell off this house.

    This selling will attract short term capital gain as the new asset is not held for 3 years . My 2 queries are :

    1) What will be the impact on my tax liabilities due to earlier exemption claimed under Section 54F.
    2) If the new transaction is in loss i.e. the house is sold in loss, the short term capital gain and tax liabilities arising due to earlier claimed exemption can be minimised.


    Regards,
    Himanshu Agarwal
     
  2. Neha Sharma

    Neha Sharma Active Member

    1. If the new property is sold within a period of 3 years from the date of its acquisition, then, for the purpose of computing the capital gains on this transfer, the cost of acquisition of this house property shall be reduced by the amount of capital gain exempt under section 54 earlier.
    2. When you will follow the treatment as mentioned above, your 2nd query wont arise.
     
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