Sold property? You may pay zero tax u/s 82 rules

As of April 1, 2026, the Income Tax Act, 2025 has come into effect, which includes the renumbering of Section 54 to Section 82. This change impacts property buyers and sellers, particularly those dealing with long-term capital gains from residential property sales. According to Chartered Accountant Suresh Surana, under Section 82, if an individual or Hindu Undivided Family (HUF) earns long-term capital gains from selling a residential property, these gains are exempt from tax if reinvested in purchasing a new residential house property in India.

This exemption applies if the acquisition of the new property happens within one year before or two years after the transfer date, or if the new property is constructed within three years from the transfer date. However, the exemption is capped at the cost of the new asset, and any excess capital gains beyond this cost will be taxable.

The exemption also has a monetary cap of Rs 10 crore. It's important to note that capital gains exceeding this limit will be taxed as per regular provisions. Surana highlights a few key points regarding Section 82's implications, including the option to invest in two residential houses if gains do not exceed Rs 2 crore, a one-time opportunity.

However, this option is only available once in a lifetime. There's also a lock-in period where if the new property is sold within three years, the exemption is lost, leading to higher taxable capital gains. Furthermore, if the capital gains are not fully utilized within three years from the Income Tax filing deadline (which corresponds to the previous year's section 139(1)), the unutilized amount must be deposited in a Capital Gains Account Scheme (CGAS) with a specified bank or institution. Any unutilized amount after the expiry of this period will become taxable in the year it lapses.