I have purchased residential property “A” in 2006-2007, I again purchased a property “B” in 2011-2012 50 % paid by me in my name & 50 % paid by wife in her name.
Now i sell property “A” in 2014-2015 & buy a new property against that capital gains as i was residing in porperty “A”. So is this exempt?
As long as it is a residential property that you are selling(even if you reside or not), whatever is the gain that you are re-investing into another property is exempt.
Hi @RLM, we suggest you go with the first option, wherein you gift the property to you son, which will be tax exempt (as he falls under the definition of ‘relative’ under Income Tax Act). Following which your son can sell the property and buy the new residential property and claim exemption under section 54F, if all the conditions are fulfilled which you can read in the following article.
Yes, the basic exemption limit is applicable in the case of Capital Gains (Except in the case of NRI). Hence, if your total income is below Rs. 2.5 Lakh, the same will not be taxable.