Exemption of Long-Term Capital Gains from any Capital Asset On Investment In House Property (Section-54F) in case of NRI

[Capital Gain of an NRI could be Completely Exempt from Income Tax]

 It is also provided by Section 54F that where any long-term capital gain arises from the transfer of any long-term capital asset (other than a residential house) and the assessee, being an individual or a Hindu Undivided family, purchases within a year before or two years after the date on which the transfer took place or constructs within a period of three years from the transfer, a residential house, the capital gain arising from the transfer will be treated in a concessional manner, i.e. the entire capital gain arising from the transfer would be exempt from income-tax if the cost of the house that has been purchased or constructed is not less than the net consideration in respect of the capital asset so transferred. If, however, the cost of the newly acquired house is less than the net consideration in respect of the asset transferred, the exemption from long-term capital gains will be granted proportionately on the basis of investment of net sale consideration either for purchase or construction of a residential house. Even if the assessee owns not more than one residential house as on the date of transfer of the original asset, he would be eligible to this exemption from the assessment year 2001-2002. However, this concession will not be available where the assessee owns on the date of the transfer of the original asset more than one residential house, or purchases within the period of one year after such date, or constructs within a period of three years after such date, any other residential house. In such cases, the exemption allowed would stand forfeited. Another important condition which should be noted by an NRI is that if he transfers the newly acquired residential house within three years of its purchase or construction, then the amount of capital gain arising from the transfer of the original asset which was not charged to tax would be deemed to be the income of the year in which the new asset is transferred. In such a case the income would be charged to tax under the head “Capital gains”. This provision is also applicable for the exemption of long-term capital gains under Section 54.

 
Capital Gain of an NRI could be Completely Exempt from Income Tax
1. Exemption of Long-Term Capital Gains regarding Residential House Property (Section 54)
2. Exemption of Long-Term Capital Gains from any Capital Asset On Investment In House Property (Section 54F)
3. Exemption of Long-Term Capital Gains On Investment In Bonds of NHAI & REC
4. Exemption to facilitate the Conversion Of Partnership Firm into a Company
5. Exemption from the Levy Of Capital Gains Tax to facilitate Conversion Of Sole Proprietary Concern Into A Company
6. Computation of Capital Gains In Real Estate Transactions
7. Other Important Exemptions Regarding Capital Gains Available to NRI
8. Cost Inflation Index And Computation Of Capital Gains in case of NRI
9. Reduction Of Tax Rate On Long-Term Capital Gains In Regard To Shares And Securities
10. Concessional Rate Of Tax On Income From Certain Global Depository Receipts
11.Tax Treatment Of Capital Gain On Sale Of Shares, Debentures, Etc. Received Under ESOP
12.Provisions Relating To Set-Off Of Long-Term Capital Loss And Carry Forward Thereof ModifiedSections 70 and 74
13. Exemption Of Long-Term Capital Gains On Securities And Lower Tax On Short-Term Capital Gains
14. Issue of Foreign Currency Exchangeable Bonds Scheme, 2008
15. Miscellaneous provisions’ regarding Capital Gains in case of NRI
 
 
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