What is Section 54EC of Income Tax Act?
Capital gain bonds or 54EC bonds are the fixed income instruments that provide capital gains tax exemption under section 54EC to the investors. The tax liability on long-term capital gains from sale of immovable property can be reduced by purchasing 54EC bonds.
How do you claiming exemption under section 54B the assessee should acquire?
Capital Gain Deposit Account Scheme The assessee can claim the exemption under section 54B by acquiring a new agricultural land within a period of two years.
How is exemption calculated under section 54EC?
5. An assessee can not claim deduction of more than Rs 50,00,000 of investment made during financial year including investment made in subsequent financial year….Section 54EC Deduction on Capital Gain Under Income Tax Act.
| Sale Price of Asset | 2,00,00,000 |
|---|---|
| Long-term Capital Gains | 1,86,00,000 |
| Less: Deduction u/s 54EC | 50,00,000 |
| Net Long term Capital Gains | 1,36,00,000 |
What is Section 50C of Income Tax Act?
What is Section 50C? Section 50C is applicable only to land or building or both. Section 50C uses value adopted by the Stamp Valuation Authority (SVA) for the purpose of levying stamp duty on registration of properties, as guidance value to determine undervaluation of land or building if any in the sale agreement.
Is 54EC available to company?
Section 54EC exemption is available only towards the capital gain arisen on account of transfer of long term capital asset (being land or building or both).
Are 54EC bonds tax free?
Interest: Interest on 54EC bonds is taxable. No TDS is deducted on interest from 54EC bonds and wealth tax is exempted. Tenure: 54EC bonds come with a lock-in period of 5 years (effective from April 2018) and are non-transferable.
Who can claim 54EC exemption?
Any assessee can claim exemption u/s 54EC. Therefore, an Individual, HUF, Company, LLP, Firm, etc can claim this exemption. The asset sold is a Long Term Capital Asset (LTCA) being Land or Building or Both. The asset is long Term if it has been held for more than 24 months.
Are you exempt from capital gains if you buy another house?
Is there capital gains tax on the sale of a second home? The capital gains exclusion on home sales only applies if it’s your primary residence.
How is US 54F exemption calculated?
When full Net Consideration/Sales Value is invested, the full amount of Capital Gains is exempt under section 54F of the Income Tax Act. When full Net Consideration/Sales Value is invested, the full amount of Capital Gains is exempt under section 54F of the Income Tax Act.
Who can claim exemption under section 54EC?
Section 54EC: Old Asset: Any Asset, New Asset: Specified Bonds. Gains arising from the transfer of any long term capital asset are exempt under section 54EC if the assessee has within a period of 6 months after the due date of such transfer invested the capital gain in long term specified bonds as notified by the Govt.
What is 50C value?
Is there an exemption under section 54B of the Income Tax Act?
Exemption under section 54B of the Income Tax Act is available on Capital Gains on sale of agricultural land and purchase of new agricultural land. The amount of Exemption under Section 54B will be lower of: The Capital Gains on the sale of Agricultural land.
Can a capital gain be claimed under section 54B?
Exemption under section 54B can be claimed in respect of capital gains arising on transfer of capital asset, being agricultural land (may be long-term or short-term). This benefit is available only to an individual or a HUF. The land should be used for agricultural purpose at least for two years.
What are the consequences of section 54B being withdrawn?
Consequences: The exemption u/s 54B is withdrawn. However, a taxpayer will be able to claim the cost of acquisition (Total Purchase Price – Exemption u/s 54B) while calculating capital gains. When new agricultural land is sold after 3 years from the date of purchase/construction.
How does section 54B apply to agricultural land?
Section 54B gives relief to a taxpayer who sells his agricultural land and from the sale proceeds he acquires another agricultural land. The detailed provisions in this regard are discussed in this part. Following conditions should be satisfied to claim the benefit of section 54B.