I am planning to sell my house and invest the the capital gain amount in capital gain account in bank. Can I use this capital gain amount to buy land first and then construct the house ? Land will be from one person and house construction from another builder.
Let me know if this is possible.
1 Answers
Hi,
Yes, you may do so. I believe the time-limit would be three years.
- If you do not utilize the amount within three years of the sale of the first property, such un-utilized amount will be treated as LTCG this will lead to taxation of the unutilized amount as long-term capital gain after three years of the sale of the first / original property.
- The deposited money can be used only to buy or construct a residential house within the prescribed time frame.
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