SECTION 54 EXEMPTION FOR CAPITAL GAINS

SECTION 54 EXEMPTION FOR CAPITAL GAINS

SECTION 54 EXEMPTION FOR CAPITAL GAINS
A person wanted to shift his residence due to certain reason, hence, he sold his old house and from the sale proceeds he purchased another house. In this case the objective of the seller was not to earn income by sale of old house but to acquire another suitable house. If in this case the seller was liable to pay income-tax on capital gains arising on sale of old house, then it would be a hardship on him. Section 54 gives relief from such a hardship. Section 54 gives relief to a taxpayer who sells his residential house and from the sale proceeds he acquires another residential house

54 Section applicable only for the asset transferred should be a long-term capital asset, being a residential house property

Please follow the steps below t o enter 54 exemption detail
 
Go into transactions → Capital Gain Head → Other Asset  → Residential House 




Information is required to be filled -
Description
Date of sale
Date of Purchase
Sales Consideration
Purchase Cost 

Now click on "Fill Exemption Detail"








Now you will be able to see, 54exemption detail - 
Exemption under section 54 can be claimed in respect of capital gains arising on transfer  of capital asset, being long-term residential house property. Exemption under section 54  will be lower of following :
Amount of capital gains arising on transfer of residential house; or
Amount invested in purchase/construction of new residential house property




Check in itr form  - Schedule CG  > D Information about deduction claimed against Capital Gains







Hope This Helps 

    • Related Articles

    • SECTION 54 F EXEMPTION FOR CAPITAL GAINS

      SECTION 54 F EXEMPTION FOR CAPITAL GAINS 54F. Capital gain on transfer of certain. capital assets not to be charged in case of investment in residential house.—(1) Where, in the case of an assessee being an individual, the capital gain arises from ...

    • Tax calculation on long-term capital gains as per section 112A

      Tax Calculation on long-term capital gains as per section 112A Exemption for long-term capital gains arising from transfer of listed securities as referred to in Section 10(38) has been withdrawn by the Finance Act, 2018 w.e.f. Assessment Year ...

    • Section 112A – Income Tax on Long Term Capital Gain

      Introduction to Section 112A – Income Tax on Long Term Capital Gain  Vide Finance Bill 2018, the Government has come up with an insertion to section 112A under the Income Tax Act, 1961.  The new section 112A has been inserted in order to levy ...

    • How to select New Tax Regime in Income Tax Software?

      Form 10IE To Select New Tax Regime In Budget 2020, taxpayers were given an option to choose between the old and new tax regime. Under the new tax regime, taxpayers have an option to pay lesser tax on the total income.  That means taxpayers will not ...

    • Which schedule is to be filled for claiming exemption u/s 10(23)(C)(vi)?

      Procedure to be followed for schedule is to be filled for claiming exemption u/s 10(23)(C)(vi)? Income to be disclosed in Schedule AI and/or Schedule VC For this Go to Transaction > Other Source Income              1. Other Donation is known as ...