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Time of India
a day ago
- Business
- Time of India
Can I buy a new house with home loan and pay it off soon when my old house is sold? Will I get capital gain tax benefit?
Tired of too many ads? Remove Ads (Disclaimer: The opinions expressed in this column are that of the writer. The facts and opinions expressed here do not reflect the views of .) Under Section 54 of the Income Tax Act, 1961, an individual can claim exemption from taxation of long-term capital gains (LTCG) arising from the sale of a residential property if the gains are invested in the purchase of another residential property either within a year before or two years after the date of sale (or within three years in case of construction). Section 54 does not mandate that the capital gains be directly used for the purchase. It only requires that the investment in the new residential property falls within the specified timelines. Judicial precedents have affirmed that the exemption under Section 54 can be claimed even if the new property is acquired through a loan and the capital gains are later used to repay that loan. Though supported by several tribunal rulings, assessing officers may deny the exemption if capital gains aren't directly used for the purchase. However, courts have allowed it in similar cases where gains were used to repay a home loan for the new best option is to continue with your home loan if you have taxable income to claim deductions under Section 24. This will help you save on income tax and potentially avoid capital gains tax. If you have no taxable income (from pension, rental income, interest, or dividends), consider selling the house and using the proceeds to prepay the loan. To minimise tax liability, use the capital gains for prepayment. You can pay more than the capital gains if you wish. The capital gains tax can be avoided if the house was purchased within one year using the home loan. Otherwise, you will need to pay tax on the capital our expertsHave a question for the experts? etwealth@
Time of India
17-07-2025
- Politics
- Time of India
The voter & the commission
Nandita Sengupta is a senior editor with The Times of India. Her blog aims to be mainly about all matters women, which includes men on occasion. Share your ideas with her on and please keep comments and feedback civil. LESS ... MORE TDP wants EC to clarify that its countrywide Special Intensive Revision (SIR) is 'not related to citizenship verification'. As Supreme Court asked EC last week, 'why are you getting into' deciding citizenship. EC's initial insistence on birth certificates for those enrolled after 2003 was based on Vajpayee NDA's Citizenship Amendment Act 2003 – those born after 1987 and before 2004 must show one parent is an Indian citizen. Those born after 2004 must prove both parents are citizens. Many poor and internal migrants, including minorities, aren't able to produce such documents. Read full story on TOI+ Facebook Twitter Linkedin Email Disclaimer Views expressed above are the author's own.
Time of India
03-07-2025
- Business
- Time of India
I am 52. How can I build a retirement corpus of Rs 5 crore in 10 years?
Academy Empower your mind, elevate your skills If you are comfortable about taking risk and investing in equity, you can amass around Rs 8.13 crore (pre-tax) by investing Rs 3.5 lakh per month, assuming 12% CAGR in equity for 10 years. You will be able to comfortably accumulate Rs 5 crore for your child's education. Over and above this, you would be saving additional amounts, which could be used to repay the loan. Keep in mind that equity markets can be volatile. Thus, keeping a buffer period and redeeming during good market conditions at the end of your time horizon is vital to maintain optimum returns. I also assume you have factored in inflation to arrive at the `5 crore figure for your child's education. If not, factoring in inflation is important as today's value will not be the same after 10 years. Education inflation rate will be around 10% per annum in India, and if you want your child to study abroad, you will need to consider the currency and inflation of that particular region as well. Keep your portfolio simple by in vesting in flexi-cap mutual funds . You could consider investing in two growth-oriented and two value-oriented flexi-cap funds from a diversification point of priority should be to ensure your portfolio lasts as long as you do. It's crucial to identify instruments that can generate regular income while also allowing your portfolio to grow. Income can come from a combination of Senior Citizens' Savings Scheme and RBI Floating Rate Bond (FRB) interest payouts, FD interest, or systematic withdrawal plans (SWPs) from debt or debt-oriented hybrid mutual funds. Portfolio growth can be driven by your equity fund allocation. Equity allocation can be diversified across 2-3 schemes, such as large-cap index funds , flexi-cap funds, and aggressive hybrid funds . A suggested mix could be 30% in large-cap index, 30% in flexi cap, and 40% in aggressive hybrid funds. This can be deployed gradually over 1-2 years to average out entry points, especially if you're new to equities. Ideally, equity investments should be held for at least 5–7 years to our expertsHave a question for the experts? etwealth@
Time of India
17-06-2025
- Business
- Time of India
I have a voluntary retirement corpus of Rs 1 crore and my annual expenses are Rs 6 lakh. How to generate a sustainable income?
Our panel of experts will answer questions related to any aspect of personal finance. If you have a query, mail it to us right away. Tired of too many ads? Remove Ads (Disclaimer: The opinions expressed in this column are that of the writer. The facts and opinions expressed here do not reflect the views of .) Investing Rs 1 crore in fixed deposits, small savings schemes or corporate bonds can fetch yields of 7.5% or more. However, these are pre-inflation returns and may not cover long-term, post-retirement needs. A sound retirement plan should have two components—fixed-income corpus for regular income and an equity corpus for inflation-beating growth. Allocate Rs 45 lakh to direct plans of ultra-short duration funds for seven years and start a systematic withdrawal plan SWP ) for monthly income. Renew the SWP annually adjusting for inflation . Assuming 6% return and 6% inflation, the corpus should last seven years, with Rs 6.9 lakh as buffer. Maintain an emergency fund covering six months of essential expenses, parked in high-yield FDs from small finance banks. Allocate 10% of corpus to gold funds, which hedge against volatility and inflation. Invest the remaining corpus equally in flexi-cap and large-cap funds via one-year SIPs. Assuming 12% return, this portion could grow to Rs 92 lakh in seven years. Then redeem gradually to replenish your fixed income portfolio for sustained it's ideal to invest near market bottoms, current global and market uncertainties make timing difficult. A reasonable correction has taken place, but valuations are not deeply undervalued. Further corrections— whether by price or time—cannot be ruled out. Hence, a balanced approach is advisable. One strategy could be investing 25-35% upfront and staggering the rest over 6-12 months. If markets correct sharply, you can accelerate deployment. While not perfect, this method helps balance risk and opportunity. Unless you're confident about tactical or sector-specific bets, it's better to stick with large-cap index funds, flexi-cap funds, and large- & mid-cap our expertsHave a question for the experts? etwealth@
Time of India
11-06-2025
- Business
- Time of India
I am 25 years old and in my first job. Should I buy a house or build financial assets first?
Academy Empower your mind, elevate your skills Ask our experts Have a question for the experts? etwealth@ If buying a house for yourself is a primary priority, then go for it, but be mindful of some challenges. First, securing a home loan may not be easy as some lenders may require two years' continuous employment to be eligible for a home loan. Second, only a part of the cost of the house will be covered by the home loan. For instance, if the purchase price of a house is Rs 50 lakh, the actual cost of ownership, including furnishing and other expenses, will be around Rs 65 lakh. Of this, the loan will cover only Rs 40-44 lakh. While making a big commitment like home ownership, ensure you have an emergency fund, which should ideally be six months of expenses, to avoid defaults. Home buying is rewarding but requires disciplined you look at the rental yields (rent divided by the total cost of buying a house including interest on loan), it is pretty low at 3-4%. REITs may give you slightly higher returns at 6% or more but are not guaranteed and can vary. REITs are quasi-equity instruments and come with equity risks. Much of their income comes from rent from commercial properties. So depending on your risk profile and need for fixed cash flow (whether you really need a fixed sum every month), you would need to make a call. If your only need is income, you can also use options like RBI Floating Rate Savings Bonds that deliver superior returns.
