What is the benefit of Capital Gain in case of a house property?
Benefit on Sale of any capital assets (Section 54F) The Income Tax Act, 1961 gives a person who does not own a residential house a concession to purchase a residential house as and when they sell s capital asset (for e.g. shares, bonds, debentures, moor car etc.). When you sell a capital asset normally you are required to pay tax on the gain in the value of asset after the benefit of indexation. If however you do not own a residential house you can reinvest the net consideration you received from the sale of capital assets in a house property and if the amount invested is equal to or more than the net consideration no income tax is payable in such capital gain. However, the following needs to be noted for claiming such benefit. You should purchase the residential house within a period of one year before or two years after the date on which the transfer took place or construct a residential house within 3 years of such transfer. You should not be an owner of more than one house property
