Withdrawl of Interest on Capital Gains Account Type B

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  1. narendraj

    narendraj New Member

    Pl clarify whether interest earned on fds placed under account B of capital gains account scheme 1988 can be withdrawn and used to pay income tax on interest earned on those fds. Also clarify whether the amount to be. Invested in new property should include the interest earned in capital gains account. A and B or it should be only the amount of capital gains arising out of the sale of property
     
  2. gaurav_kumar

    gaurav_kumar Well-Known Member

    The Interest earned on amount deposited in Capital Gains Account Type B can withdrawn and used to pay Income Tax on such Interest.

    Income Tax on such Interest would be levied as per the Income Tax Slab Rates applicable for the year in which the income is earned.

    The Interest earned on Deposit in the Capital Gains Account is not required to be reinvested. Only the amount of Capital Gains originally earned on the sale of asset is to be reinvested.
     
  3. narendraj

    narendraj New Member

    Thanks Gauravkumar for quick response. If I do not invest in nee
     
  4. narendraj

    narendraj New Member

    Thanks Gauravkumar for quick response. If investment in new property is. Not done by the end of 2/3. Yrs. then tax at the rate of 20 % will. be deducted and balance can be claimed as refund. BUT WILL THIS. ATTRACT PENALTY AND/OR. INTEREST ON TAX AMOUNT FOR EFFECTIVE DEFERMENT. OF TAX LIABILITY FOR 2/3. YEARS. ??
     
  5. gaurav_kumar

    gaurav_kumar Well-Known Member

    1. In case you are unable to reinvest within the specified period - No Penalty would be levied and only Capital Gains Tax @20% would be levied
    2. The Interest earned on the Capital Gains Type B Account is taxable every year as per the income tax slab rates.
     
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