CS Executive · Tax Laws and Practice · Capital Gains
Under the Income-tax Act, 2025 (applicable from the June 2027 session), Section 85 gives relief on investment in a long-term specified asset. Which original asset must be transferred to claim this relief?
The relief applies only when the original asset transferred is land or building, or both, and the gain is long-term. Other assets such as shares or gold, and short-term gains, are outside Section 85.
- AAny long-term capital asset, including shares and gold
- BLand or building, or both, giving long-term capital gainsCorrect
- CA residential house only, giving short-term capital gains
- DUnlisted shares giving long-term capital gains
Explanation
Section 85(1) applies where long-term capital gains arise from transfer of land or building, or both. Shares, gold or short-term gains do not qualify, so the options naming them are wrong.
Did you get it right without looking?
One question tells you little. A timed set on Capital Gains shows your real accuracy, how long you take and where you lose marks.
More Capital Gains questions
- Which bond qualifies as a 'long-term specified asset' under Section 85 of the Income-tax Act, 2025?
- Mehta Traders transfers an undertaking by slump sale after owning it for 30 months. Under the Income-tax Act, 2025, how is the profit from t…
- Under section 83 of the Income-tax Act, 2025, an individual does not utilise the capital gain on agricultural land to buy new land before fi…
- In a slump sale of a division by Bharat Engineering Ltd, the books show the following assets: land and stock at book value Rs 40 lakh, depre…
- Under the Income-tax Act, 2025, Aarav Traders Ltd transfers an undertaking by way of slump sale after owning and holding it for 30 months im…
- Meera has long-term capital gains of Rs 40 lakh from transferring a building. Within six months she invests Rs 30 lakh in eligible REC bonds…