How long do I have to buy another property to avoid capital gains?

Here’s how you can qualify for capital gains tax exemption on your primary residence:

• You’ve owned the home for at least two years.
• You’ve lived in the home for at least two years.
• You haven’t exempted the gains on a home sale within the last two years.

How long do you have to buy another house to avoid capital gains in India?

There is no tax to be paid if you use the entire gain from the transaction to buy another house within two years or construct one within three years. The two- and three-year period applies even if you bought another house a year before selling the first one.

How can I avoid capital gains tax when selling a house in India?

Under Section 54, you can avoid paying tax on long-term capital gains if you reinvest the gains to buy another property. To save taxes, you will have to buy the new property one year before the sale or two years after the sale. The new property should not be transferred within three years of the acquisition.

Can I sell a house which is on loan?

Answer: In case you want to sell the property on which you have a running home loan, you will need your lender’s consent for the same. This consent is typically provided in the form of a letter which will typically provide the amount, on payment of which the outstanding loan will be fully paid off.

Can I sell my house and not buy another one?

If you’re moving within the same city, you can use the same agent to both sell your current house and buy your new one. But if you’re moving to a new area, then you’ll need to find a new real estate agent. While it’s not ideal to buy a house without seeing it, a good agent can help you figure out the logistics.

What are capital gains when selling a house in India?

Selling a house is a gargantuan and tedious task in itself, add to that the fact that you will be charged a tax on your capital gains and you have the perfect recipe for a headache. If you’re selling a property in India, the profits you earn are called Capital Gains.

How long does it take to sell a property for capital gains?

If you sell your land / house / property within 36 months (3 years) of acquiring it, it’s considered to be a short term capital gain. If you sell it after 36 months (3 years) it’s considered to be a long term capital gain.

Can I Sell my House after 3 years in India?

The property being bought / developed is within India’s national borders. You don’t sell the new house for 3 years after taking possession of it. If the cost of the new property is lesser than the sale amount, the exemption then only applies proportionately. The remaining money can be re-invested under Section 54EC in under 6 months.

How to save LTCG tax by investing in another property?

Hence, you only have to invest the capital gains amount to save LTCG tax. The maximum amount of capital gains that you can re-invest in another property and get complete exemption is Rs 2 crore. If your capital gain is higher, you will have to pay capital gains tax on the amount exceeding Rs 2 crore.