Neutral impactCorporate Action
Sold a house and bought another within 2 years? Here's when capital gains could still be taxable – Section 54 rules
Mint 1 hr ago·22 Oct 2026, 2:10 am
The government has introduced new rules under the 2025 Act that could impact tax exemptions for property investors. Under the previous Section 54, selling a residential house and reinvesting the gains in another property could lead to tax relief. However, the new rules have stricter conditions. If the funds are not fully utilized for the new property within the specified time frame, the exemption may be denied or withdrawn. This change aims to ensure that tax benefits are not misused.
For investors, this means that simply selling one property and buying another is no longer enough to guarantee tax exemption. The new regulations require strict adherence to timelines and investment limits. Failure to meet these conditions could result in a higher tax liability. Investors should carefully review the new rules to avoid unexpected tax burdens.
Moving forward, investors should focus on the specific conditions outlined in the new Act. Keeping track of the investment timeline and ensuring that the full capital gains are reinvested in the new property is crucial. Consulting a tax professional can help navigate these changes and ensure compliance with the updated regulations.
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- Category: Corporate Action.
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