Investment options from sale proceeds of property

Hello Sir,

you can invest your money for any shorter duration in mutual fund liquid fund, it is money market oriented fund and it has about 8-9% returns PA ehich will be calculated on daily basis and you will get your additional part on how many days you kept your investmet.

there is no risk and it is safe to park big amount.

for more information contact me on [deleted]

Hi,

Hope you are doing well !!

If you are unable to invest the sale proceeds before the date of income tax returns filing , you can deposit the CAPITAL GAINS (not entire sale proceeds) amount in a public sector bank or other banks as per the Capital Gains Account Scheme- CGAS, 1988.

The capital gain (full amount or utilized amount) can be deposited in CGAS account.

This is only a stop-gap arrangement, as the funds have to be used to buy or build a house within the period specified.

The deposited money can be used only to buy or construct a residential house within the prescribed time frame.

If you withdraw funds from this account, they have to be used within 60 days.

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 interest rates paid on these accounts are the same as those on regular savings and term deposits. Kindly note that interest earned on this account is taxable.

Thanks & Regards,

Payal Chhajed

-Aditya Birla Sun Life - Approx return 7.8-8%

-Reliance Liquid fund- Approx return 7.8-8%

Yes sir, you can go with ICICI Liquid fund, Reliance Money Manager Fund, ABSL Cash Manager Fund etc. you can contact me for more information or to provide investment support.

Hi

You can invest the amount of capital gains in another rrsiresiden house property and claim Exemption from capital gains under section 54.

Such Property has to be purchased within 2 years of sale of old property or constructed within 3 years.

If the investment is not made before due date of return filing of the year of sale, the amount has to be deposited in Capital gain deposit account. I.e. if Property is sold in FY 18-19 and not invested upto 31 March 19, the amount of capital gains have to be deposited in CGDS.

Other option is investment in bonds eligible under section 54 EC. Such investment is to be made within 6 months of sale.

Such bonds shall be redeemable after 5 years. 

Maximumamount that can be invested in such bonds is 50 lacs.

You can purchase new residential house and claim exemption u/s 54 of income tax act,1961 to the extent of amount invested, if you invest amount greater than you capital gain than whole of your gain is exempt and you are not required to pay any tax.

Further you can also invest means provided u/s 54EC (within 6 months after the due date of such transfer) in NAHI, REC Bonds, there is lock in period of 3 years for the same. Investment limit is 50 Lakhs. 

Further u/s 54 you can also deposite your money arised out of such gain in capital gain account scheme.

No liquid funds notified by CBDT for exemptions.

I answered assuming your capital asset i long term capital asset.

I hope you get answers for your problem. If you have any further query plz let me know. Thanks!!

Hi,

The investment options would depend on whether there are capital gains or not in the transaction you undergo. If there are capital gains, you can reinvest the capital gains in a residential property and claim exemption of capital gains taxes u/s 54. You can also claim exemption by investing in capital gains bonds u/s 54EC.

However, if there are no capital gains then the investment would depend on your risk appetite. You have various options to invest the sale proceeds depending on your risk profile. You can either invest in Mutual Funds, FD's, other liquid funds, Equity oriented SIP's or in physical assets like gold.

You can get in touch with me for further discussions and any asisstance that you may need,

Regards.

Dear Sir

You can park your fund in Various in Various FDs & in saving bank to gain interest so that you can efficiently & effectively utilised your sale proceeds recd. from  Property sold

Thanks & Regards

SK Agarwal

Hi,

You have following options:

1.Liquid funds

2. Capital gain account scheme

3.Give someone as a loan with higher interest rate.

4. Share market based on proper consultation.

1. Mirae assets cash management plan-(High Risk, High Return)

2.Reliance liquid-(Moderate)

3.Aditya Birla-(Safe)

First of all plan and invest your sale proceeds in some options where you can save tax, like investing in another apartment or bonds under section 54EC.

However if you are still confused and don't know which property to buy and you want to invest the amount in some other place for a short period of time then you can invest in some liquid or equity mutual funds they can give you great return but they are quite risky in small period especially equity funds. You can invest in Aditya Birla mutual fund or HDFC mutual fund.

Also if you are not sure that whether you can purchase new property by year end you will have to deposit amount in capital gain scheme account to save capital gain tax.

Hope you find the information helpful if you do please rate it 5 and provide your valuable feedback for my improvement.

Thank you

Hi,

- It is better to invest in house property only. For purchase, you need to purchase it within 2 years from the date of transfer and for construction it is 3 years from the date of transfer.

- If you can not invest before filing of ITR for this year, deposit the amount in CGAS.

Thanks