Will I get Tax Exemption on LTCG from the flat I sold ?

Question

I sold my flat in January 2019 for Rs 37 lakhs and made LTCG of Rs 17 lakhs. I booked an under construction flat in 2015,and I am yet to pay final Installment of Rs 8 lakhs. It is due in August at the time of possession.

The cost of new flat is Rs 93 lakhs. Will I get tax exemption on LTCG from the flat I sold?

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Answer ( 1 )

  1. To claim tax exemption on LTCG under section 54 of the Income Tax Act ,the new house should be purchased within a year before or two years after the sale of a property ,or it should be construced within three years from the date of sale .AS you have booked an under constructed flat based on various precedents,it can be said that builder is constructing new flat for you.So ,you can claim on LTCG tax of Rs 17 lakhs ,as the cost of construction of the new flat is higher than your capital gain.

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