What is section 54F in Capital Gain

Section 54F in capital gain

Capital gain arising on transfer of an asset which is not a residential house(ie. any other capital asset) by Individuals and Hindu Undivided Family (HUF) are exempted to the extent of amount utilized for new residential house.


  • Amount exempted under section 54F is computed by using the formula:

                  Capital Gain X Cost of new House / Net Sales Consideration.

  • Assessee does not own more than one house other than that which is completed construction within 3 years after the sale or purchases within 1 year before or 2 year after the sale.
  • He should not transfer his new residential house within 3 years of its purchase or construction.
  • Assessee should not construct or purchase any new house within 1 year, 3 year respectively in addition to the above mentioned residential house.





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