PLANNING TO INVEST YOUR MONEY!!!!!

PLANNING TO INVEST YOUR MONEY!!!!

HAVE YOU JUST SELL ANY OF YOUR ASSET LIKE HOUSE PROPERTY, GOLD JEWELLERY etc. ????

HAVE YOU EARNED ANY PROFIT FROM THE SALE OF ABOVE ASSET????

HAVE WORRIED ABOUT THE TAX IMPLICATIONS???

WANT TO SAVE TAX WHICH IS GET ATTRACTED BY THE ABOVE TRANSACTION??

THE ABOVE PROBLEM IS RESOLVED BY SECTION 54EC OF INCOME TAX ACT, 1961.

ACCORDING TO THIS SECTION IF ANY ASSET IS TRANSFERRED AND THAT ASSET IS USED FOR MORE THAN 36 MONTHS OR 12 MONTHS (IN CASE OF SHARES) AS THE CASE MAY BE, IF ANY CAPITAL GAIN IS EARNED AND IF THAT CAPITAL GAIN IS INVESTED IN PURCHASE OF BONDS ISSUED BY OF NATIONAL HIGHWAY AUTHORITY OF INDIA OR RURAL ELECTRIFICATION CORPORATION LTD. WHICH IS REDEEMABLE AFTER 3 YEARS, IF ANY OR WHOLE OF THE CAPITAL IS INVESTED FOR THE PURCHASE OF ABOVE SPECIFIED BONDS THEN WHOLE OR THE AMOUNT INVESTED WILL NE EXEMPT FROM TAX i.e. IT IS NOT TAXABLE IN THE HANDS OF ASSESSEE

TO GET THE EXEMPTION FROM THE TAX, THE FOLLOWING CONDITIONS MUST BE SPECIFIED:-

1. THE HOLDING PERIOD OF ASSET MUST BE LONG TERM WHICH MEANS THE ASSET MUST BE USED BY ASSESSEE FOR MORE THAN 36 MONTHS OR 12 MONTHS IN CASE OF SHARE AS THE CASE MAY BE.
2. THE PRESCRIBED PERIOD OF INVESTMENT MUST BE WITHIN 6 MONTHS, IT MEANS THE ASSESSEE SHOULD PURCHASE SPECIFIED BONDS WITHIN THE PERIOD OF SIX MONTHS FROM THE DATE OF TRANSFER.
3. IF ANY AMOUNT IS LEFT UNUTILISED, THE SAID MONEY MUST BE DEPOSITED IN CAPITAL GAIN ACCOUNT UPTO DUE DATE OF FURNISHING OF RETURN OF INCOME.
4. IF THE BONDS SOLD WITHIN THE PERIOD OF 3YRS FROM THE DATE OF PURCHASE, THE CAPITAL GAIN WHICH IS EXEMPT EARLIER SHALL BE TAXABLE AS LONG TERM CAPITAL GAIN IN THE YEAR OF TRANSFER.

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