Taxpayer co-owning more than one home can claim benefit: ITAT

Dated on: Monday 12th June 2023

The Mumbai bench of the Income-tax Appellate Tribunal (ITAT) has ruled that individuals who co-own multiple residential houses can still claim tax exemption on long-term capital gains. This decision, which pertains to Section 54F of the Income-tax Act, will be advantageous for many taxpayers, especially in larger families where investments are often made jointly. Under Section 54F, if a taxpayer sells capital assets such as jewelry or shares and reinvests the entire net sale consideration in the purchase or construction of a house property within the specified timeframe, no tax liability will arise on the resulting long-term capital gains. In cases where only a portion of the sale consideration is invested in a house property, the tax exemption will be allowed proportionately.

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