EXEMPTIONS FROM CAPITAL GAINS UNDER INCOME TAX ACT

EXEMPTIONS FROM CAPITAL GAINS

The Income-tax Act permits a capital gains tax exemption if the proceeds from the sale, or capital gains, as applicable, are used to purchase specific new assets. These exemptions are offered according to the following sections :

1. Section 54:

Exemption from the capital gains arising from the transfer of residential house property and investment in new house property.

2. Section 54B:

Exemption from the capital gains arising from transferring land used for agricultural purposes and investing in new agricultural land.

3. Section 54D:

Exemption from the capital gains arising from the compulsory acquisition of land and building, forming part of the industrial undertaking and investing in land or building for setting up or shifting of the industrial undertaking.

4. Section 54EC:

Exemption from the capital gains arising from the transfer of land or building or both and investing in specified bonds.

5. Section 54EE:

Exemption from the capital gains arising from the transfer of any long term capital asset and investing in specified assets.

6. Section 54F:

Exemption from the capital gains arising from the transfer of a long-term capital asset other than a house property and investing in a residential house property

7. Section 54G:

Exemption from the capital gains arising from the transfer of assets on shifting of industrial undertaking from the urban area to a non-urban area.

8. Section 54GA:

Exemption from the capital gains arising from the transfer of assets on shifting of industrial undertaking from the urban area to any SEZ.

9. Section 54GB:

Exemption from the capital gains arising from the transfer of residential property and investing in eligible companies or eligible start-ups.

F & Q