You sold a property or shares — three clocks started ticking.
Quick answer · 25 July 2026 — The moment you sell a long-term asset, three clocks start: a purchase window (from one year before your sale to two years after it) for buying a residential house, a construction window (three years) for building one, and — earliest of the three — the Capital Gains Account Scheme deposit, due by your return-filing deadline for whatever is still uninvested. Which section governs you is the fourth question: Section 54 if you sold a residential house, Section 54F for most other long-term assets. All of it is stated here at statutory-outline level, indicatively — your Chartered Accountant computes the real figures and anchors the real dates.
Want your own calendar dates instead of the general rule? Use the Capital Gains Reinvestment Calculator — it turns your sale month into the actual purchase, construction and CGAS dates, all indicative.
ENTERED 25 JUL 2026 · BY VIDIT KAUSHIK, VIDASTU ADVISORY DESK — UP-RERA AGENT UPRERAAGT000309/01/2026
The three clocks, one by one
Buying: one year back, two years forward
A residential house you purchase counts if the purchase falls between one year before your sale and two years after it. Yes, backwards too — a house bought up to a year before the sale can qualify.
Indicative — confirm with your CA.
Building: three years forward
A residential house you construct counts if construction completes within three years of your sale. Under-construction bookings live in the space between these two clocks — see the FAQ below for the honest answer on that.
Indicative — confirm with your CA.
The deposit deadline that arrives first
Both windows above outlast your next income-tax return. Whatever is still uninvested when the return falls due needs to be parked in a Capital Gains Account Scheme (CGAS) account before the filing deadline — that deposit is what keeps the claim alive while your window stays open. Miss this clock and the longer windows may not save the claim.
Indicative — confirm with your CA.
Section 54 vs Section 54F, side by side
| Question | Section 54 | Section 54F |
|---|---|---|
| What did you sell? | A residential house (long-term) | Any other long-term asset — plot, land, shares, more |
| Exemption is measured against | The capital GAIN | The NET SALE CONSIDERATION — reinvest part, get a proportionate exemption |
| What you reinvest into | A residential house | A residential house |
| Ownership condition | — | On the sale date, not more than one other residential house |
| Hold the new house | About three years | About three years |
| Windows | Purchase −1 yr / +2 yrs · construction +3 yrs | Purchase −1 yr / +2 yrs · construction +3 yrs |
| If not reinvested by ITR due date | CGAS deposit preserves the claim | CGAS deposit preserves the claim |
The one-sentence versions: Section 54 — you sold a residential house, and the exemption is measured against the capital gain you reinvest in a residential house. Section 54F — you sold a long-term asset other than a residential house, and the exemption is measured against the net sale consideration, so the proportion of the full sale amount you reinvest is what drives it. Both are the statutory outline, not your computation — your CA runs the real one.
Frequently asked
What is the difference between Section 54 and Section 54F?
Section 54 applies when you sell a residential house: the exemption is measured against the capital gain, and it is the gain you reinvest in another residential house. Section 54F applies when you sell a long-term asset other than a residential house — a plot, shares, another asset — and it is measured against the net sale consideration: the proportion of the full sale amount you reinvest is what drives the exemption. Which one fits your facts is indicative here — confirm with your CA.
How long do I have to reinvest after selling?
Two windows run from your date of sale: buying a residential house counts from one year before the sale to two years after it, and constructing one counts up to three years after it. A third clock sits earlier — the Capital Gains Account Scheme deposit by your return-filing deadline. These are the standard statutory windows, stated indicatively — your CA anchors the exact dates to your date of transfer.
Does an under-construction purchase count?
This is genuinely the question for your CA, because the statute draws a purchase-versus-construction distinction: a purchase has a two-year window, construction has three, and an under-construction property sits between the two — completion timelines matter for which window your booking is tested against. Take the builder's completion schedule to your CA before you commit, not after.
What is the Capital Gains Account Scheme, and when do I need it?
If part of the amount is still uninvested when your income-tax return falls due, depositing the unutilised amount in a Capital Gains Account Scheme (CGAS) account with an authorised bank before the filing deadline preserves the claim while your window stays open. The deadline is typically the return-filing due date for your category — your CA confirms the exact date and the deposit mechanics.
Do I have to reinvest the entire sale amount?
It depends on the section. Under Section 54 the exemption is measured against the gain, so the gain is the figure that matters. Under Section 54F it is measured against the net sale consideration, so reinvesting only part of the full sale amount gives a proportionate exemption. Both statements are the statutory outline, not your computation — confirm the amounts with your CA.
Can I claim Section 54F if I already own another house?
Section 54F carries an ownership condition: on the date of sale you should not own more than one residential house other than the new one. Owning more than that can take 54F off the table entirely — an eligibility fact your CA verifies before anything else.
How long must I hold the new property?
About three years. Selling the new residential house within that period can undo the exemption you claimed, with the tax consequence landing in the year you sell. How this condition operates on your exact facts is for your CA.
Do shares qualify for this reinvestment route?
Long-term shares or equity are assets other than a residential house, so Section 54F is the provision that typically comes into play when you reinvest the sale amount in a residential house. Whether your specific holding qualifies as long-term, and how grandfathering affects the numbers, is exactly what your CA computes.
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