Hey @Gaurav_Sanghavi,
The gains would become taxable in FY 2025-26. Moreover, you can sell multiple assets and invest the proceeds in a residential property to claim the exemption.
There are more conditions that need to be satisfied:
Hope this helps!
@Surbhi_Pal
Nice read. I had one query regarding section 54F.
I had purchased an under-construction apartment in Mumbai in 2019 with a construction-based payment plan. The same was handed over to me in July-2023. I had booked LTCG and STCG by selling some shares during FY2023-24. These proceeds were used to pay for the apartment installments.
How do I claim the deduction against the capital gains?
The ITR-2 form mandatory field asking details of account and deposit date (as attached screenshot). I didnât open any Capital Gains Account. The payments were done from my savings account.
What should be filled in account details?
Hello @Bharti_Vasvani, @TeamQuicko thanks for this. Could you please help with a clarification on the following case -
The seller has 2 residential houses in her name and 1 residential plot.
She intends to transfer 1 of the houses through gift/settlement to her child and also sell the plot.
The proceeds from the sale of the plot will be parked in a capital gains account and the funds will be entirely used to buy an apartment from a developer. The agreement to sale has been signed with the developer and the apartment will be completed in 3 yearsâ time.
Please clarify if she must transfer the house to her child before the sale of the plot or if she has time until she signs sale deed/registration for the new apartment. Thank you.
Hey @Jayanth, if you want to claim a capital gain exemption under section 54F, the following conditions must be satisfied:
Hence it is better if one of the House property is gifted before selling the plot for claiming capital gain exemption.
Hope this helps!
Dear Madam,
My question is regarding exemption u/s 54F
I purchsed a residential flat on 29.3.23 for Rs 88 Lakhs. I had generated long term capital gains of Rs 15 Laks after selling shares with sale consideration of 25 Lakhs in A.Y.2023-24. In my ITR of A.Y 2023-24 I claimed LTCG of 15 Lakhs & IT deptt accepted it.
This year in A.Y. 2024-25 I sold shares for 50 Lakhs & generated LTCG of Rs 20 Lakhs. Since I didnt consume the whole limit of LTCG in A.Y. 2023-24.
and the total sale consideration is still 75 Lakhs, well below purchase value of 88 Lakhs. Can I claim LTCG exemption of Rs 20 Lakhs. in this yearâs ITR of A.Y.2024-25 under Section 54F
Thanks
S.K.Srivastava
Hey @Ssharad_Srivastava,
In my opinion, exemption u/s 54F can only be claimed once. However, you can still get a second opinion from a CA with regard to this.
Hello,
I want to buy a residential property with myself and wife as a joint property owner. I have one property in my name and my wife doesnât have any property in her name.
There is a LTCG arising from sale of equity shares from both of our portfolio.
Is it okay to claim exemption u/s 54F for both under joint property purchase?
Hey @Anand_Kamdar,
Yes, both you and your wife can claim the exemption u/s 54F.
The exemption will be available to the co-owners in the ratio in which they have contributed towards the new property.
Hope this helps!
Hi, Thank you for the reply.
Hi @Anand_Kamdar,
Yes, you can directly pay it to the builder. One needs to park the funds in CAGS only when it is not being using during the same FY and one has to claim the exemption.
The receipt should suffice. Even documents like the purchase agreement will serve as proof.
Hi,
Consider there are various transactions of LTCG as given below
| Transaction | Period | FY for 54F exemption claim |
|---|---|---|
| LTCG from Sale of stocks | Aug-24 | 2024-25 |
| LTCG from Sale of stocks | Aug-25 | 2025-26 |
| LTCG from Sale of property | Aug-25 | 2025-26 |
| Buy new property | Sep-24 | 2024-25 |
a. LTCG arising from multiple transactions can be exempted u/s section 54F for single house property purchase.
b. Construction status of property after 3 years from date of purchase is 80 to 90% but documentation like purchase agreement done before 3 years should be sufficient.
c. Exemption u/s 54F for different transactions of LTCG need to claimed in the FY in which the transaction was done.
Can you please confirm if above understanding is correct?
Hello Maam!
What is the opportunity cost of CGAS? ex if sales consideration is 40 lacs and LTCG is 14 lacs, it is âWISEâ to deposit 40 lacs to save tax around 1.4 lacs?
Also can the amount be deposited in installments say 10 lacs at time of opening on 1 July and remaining 30 lacs in 3 installments before 31 july?
Please help to clarify!
Hi @Quant_Cr,
CGAS is used when you have LTCG that you are planning to invest for claiming section 54 exemptions and are unable to make the investment before the end of the financial year. If the investments are not made within the stipulated timelines, the gains do become taxable.
Moreover, you can make the investment in instalments.
Thanks for responding!
Where do we specify what is the total deposit amount? Also can amount be deposited post 31 July for previous FY? Eg. Net cons. 60 lac, LTCG 30 lac, deposit 15 lac in type B , file return on 31 July. Deposit 10, 5 lac on 1 Aug & 1 Sep .
Is this allowed?
I have sold shares in FY 2023-24 worth ~Rs. 50 lacs and earned capital gains on the same. I have finalised an under-construction property worth Rs. 75 lacs and will pay an advance of Rs. 5 lacs before July 2024 (before filing the ITR). The remaining amount will be payable over a period of next 3 to 4 years but Rs. 50 lacs will certainly be paid within next 3 years. The property is in Mumbai and the stamp duty on the same will most likely be paid before July 2024. My questions:
Hey @Hchopra,
Yes, you can claim the deduction u/s 54F. Moreover, youâll have to deposit the remaining account in CGAS and claim the exemption for FY 23-24.
Hi,
I have sold shares in FY 2023-24 worth ~Rs. 50 lacs and earned capital gains on the same. I have finalised an under-construction property worth Rs. 75 lacs and will pay an advance of Rs. 5 lacs before July 2024 (before filing the ITR). The remaining amount will be payable over a period of next 3 to 4 years but Rs. 50 lacs will certainly be paid within next 3 years. The property is in Mumbai and the stamp duty on the same will most likely be paid before July 2024. My questions:
Hey @Hchopra,
Yes, as you are investing the entire sale proceeds into the house property, youâll be eligible to claim the exemption under section 54F. However, youâll have to deposit the amount into a CGAS account if it is not being utilised in the same financial year.
Hi @Surbhi_Pal
As per Agreement cost of apartment under construction is 1cr dated Oct 2023.
I sold few stocks and got LTCG fo 1 lakh 85k.
I used this money to pay 30% of 1cr.
In section 54F, what should I mention in cost of property , is it 30lakh or full value of 1cr?
I also intend to sell more stocks in upcoming year to pay installments to builder. Can I use 54f again in next assesment year?
