Sold property? You may pay zero tax if these Section 82 rules under Income Tax Act 2025 are met

From April 1, 2026, Tax Year 2026-2027 has started and this means the Income Tax Act, 2025 is applicable and this means you need to familiarise yourself with the newly renumbered Sections to keep your financial plans on track. Previously, under the Income Tax Act, 1961, Section 54 was a well-known term especially for those involved in buying or selling property.

The reason is Section 54 allows you to claim an income tax exemption on the selling a property if you reinvested the long term capital gains from the old property to buy a a new residential property in India.

Section 54 is now renumbered as Section 82 of the Income Tax Act, 2025.


According to Chartered Accountant Suresh Surana, under Section 82 of the Income-tax Act, 2025, if you have got long term capital gains (LTCG) from selling a residential property then you can claim a tax exemption on it if you reivest the LTCG to buy another residential house property. But for getting this tax exemption the house needs to be in India and you need to follow certain other conditions too. The conditions are:

• It applies where an individual or HUF earns long-term capital gains from the sale of a residential house property (i.e., a building or land appurtenant thereto, chargeable under the head Income from house property).
• To claim exemption, the taxpayer must reinvest the capital gains in a new residential house property situated in India, within the prescribed timelines:
• Purchase of a new house property within one year before or two years after the date of transfer or
• Construction of a new house property within three years from the date of transfer.

It is also important to note that the exemption is limited to the cost of the new asset. If the capital gains exceed the cost, the excess amount will be taxable. However, if the capital gains are equal to or less than the cost of the new asset, the entire gains shall be exempt.

Also, the benefits under Section 82 are subject to a monetary limit, with the maximum amount of capital gains eligible for exemption capped at Rs 10 crore. Any capital gains exceeding this limit will be taxable according to applicable provisions.

Here's a table showing the capital gain tax rate:

Capital asset	Holding period for long-term classification	Short-term capital-gains rate	Long-term capital-gains rate
Land or building or both	More than 24 months	Normal slab rate	12.5% without indexation*
Physical gold and jewellery	More than 24 months	Normal slab rate	12.5% without indexation
Digital gold representing underlying physical gold	More than 24 months	Normal slab rate	12.5% without indexation
Gold ETF listed on a recognised stock exchange	More than 12 months	Normal slab rate	12.5% without indexation
Listed equity shares, Equity Oriented Mutual Funds and Units of a Business Trust on which STT is applicable	More than 12 months	20% under section 111A	12.5% under section 112A on aggregate gains exceeding Rs. 1.25 lakh
Unlisted equity shares	More than 24 months	Normal slab rate	12.5% without indexation
Specified mutual fund units acquired on or after 1 April 2023	Not applicable; gains always qualify as short-term under section 50AA	Normal slab rate, irrespective of holding period	Not applicable
Debt mutual fund units acquired before 1 April 2023	More than 12 months if listed; more than 24 months if unlisted	Normal slab rate	12.5% without indexation
Other mutual funds that do not qualify as equity-oriented or specified debt funds	More than 12 months if listed; more than 24 months if unlisted	Normal slab rate	12.5% without indexation
Listed bonds and debentures	More than 12 months	Normal slab rate	12.5% without indexation
Unlisted bonds and debentures	Not applicable; gains always qualify as short-term under section 50AA	Normal slab rate, irrespective of holding period	Not applicable
Market-linked debentures	Not applicable; gains always qualify as short-term under section 50AA	Normal slab rate, irrespective of holding period	Not applicable

Source: CA Suresh Surana

Surana says that Section 82 of the Income Tax Act, 2025 highlights certain important points that are relevant from a tax planning and compliance standpoint. Some of the key points are outlined below -

• One time option to invest in two residential houses: You have the option to buy two residential house properties while reinvesting the LTCG from the sale but only if the LTCG does not exceed Rs 2 crore. This is once in a lifetime option.
• Lock-in period and withdrawal of exemption: You cannot sell the new residential property within 3 years. If you sell it within 3 years then the LTCG tax exemption given to you will be withdrawn by way of adjustment in the cost of acquisition.
• Capital Gains Account Scheme (CGAS): If the capital gains are not fully utilised before the due date of filing the return of income under Section 263(1) of the Income Tax Act, 2025 (corresponding to section 139(1) of Income Tax Act, 1961), the unutilised amount must be deposited in a notified CGAS with a specified bank or institution.

Such deposit is deemed to be used for the purpose of claiming exemption, subject to actual utilisation within the prescribed period.

Surana says: “Any unutilised amount after the expiry of 3 years becomes taxable in the year in which such period lapses.”