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Can I use capital gains to pay off another home loan and avoid capital gains tax?

T S Khurana

T S Khurana   |463 Answers  |Ask -

Tax Expert - Answered on Apr 10, 2025

A certified management accountant since 1993, T S Khurana is a fellow member of The Institute of Cost Accountants of India. His areas of expertise are income tax, specifically litigation cases, and GST.

Since the last 21 years, he has also been providing expert advice on financial matters, including investments and diversification of funds, and wealth building in the long term to his clients.
He believes that investment in real estate is the safest way for better returns and wealth generation over a period of time.

A former chairman of the Chandigarh Chapter of Institute of Cost Accountants of India, T S Khurana has also served as member of its technical committee.... more
Asked by Anonymous - Apr 07, 2025Hindi
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Hi I am selling a house with a capital gain of 50 lakh .Can i use this money to settle home loan of another house in my name partially and claim exemption in paying capital gain tax ?

Ans: Kindly confirm, when the house was purchased, at what Cost & how much share you have it it ?
Most welcome for any further clarifications. Thanks.
Asked on - Apr 10, 2025 | Answered on Apr 11, 2025
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Both the houses are in my and my wife name .Capital gain I have calculated as 50 lakh
Ans: You are entitled for exemption only, if you purchase a New House within one year before or two years after, selling the property. In case of Construction, time limit is one year before or three years after selling the property.
Hope this makes your point clear.
Most welcome for any further clarifications. Thanks.
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