Income Tax
Section 54 Exemption
Capital gains exemption when LTCG from residential property sale is reinvested in another house.
Full Definition
Section 54 of the Income Tax Act provides an exemption from LTCG tax on the sale of a residential house if the capital gains (not full sale price) are invested in another residential house: within 1 year before the sale date, or within 2 years after the sale date, or within 3 years if constructing a new house. The reinvestment must be in India. If the new house is not purchased/constructed before the ITR due date, the gains must be deposited in the Capital Gains Account Scheme (CGAS) until deployment.
Related terms
More Income Tax terms
ITR (Income Tax Return)
Annual declaration filed with India's Income Tax Department reporting income, deductions and tax paid.
AY (Assessment Year)
The year in which income earned in the previous financial year is assessed and taxed.
FY (Financial Year)
The 12-month period from April 1 to March 31 during which income is earned and recorded.
PAN (Permanent Account Number)
Unique 10-character alphanumeric identifier issued by the Income Tax Department to every taxpayer.
TAN (Tax Deduction Account Number)
10-character number required by entities that deduct or collect tax at source (TDS/TCS).