Tax on Income earned from Amt not deposited in Capital Gain Acc

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  1. Dear Sir,

    I have sold a property which was transfered in my name after the death of my mother , the property was sold in month of October'14 so till when am I Supposed to reinvest the amount received(For TAX exemption) ,Is it six months from the date of registry or before 31st march 2015 which ever is earlier ????
    Secondly with in these six month can i invest the money received in normal FD or Liquid funds ? if Yes then what are the TAX implication on interset received on FD of Liquid fund ?

  2. rudrabose

    rudrabose Active Member

    The following is the time allowed for reinvestment for claiming exemption under the following sections of the income tax act:-
    • Section 54 - 2 years for purchase/ 3 years for construction of Residential House
    • Section EC - 6 months for investment in specified bonds
    • Section 54F - 2 years for purchase/ 3 years for construction of Residential House
    For more, kindly refer:

    This time period is to be considered from the date of Registry
  3. rudrabose

    rudrabose Active Member

    In the meantime, you can certainly invest these funds in FD or elsewhere and the income arising from such investment would be chargeable as per your income tax slabs.
  4. Thank You Sir,
    I also want to know that can i invest the amount received on sale of property into buying more than one property in order to get the TAX exemetion under section 54
  5. rudrabose

    rudrabose Active Member

    The capital gains arising on the sale of flat should be reinvested in a single flat only.

    This amendment is applicable from 1st April 2014
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