Short Team Capital Gain - Reinvest

Dear Client,

Yes, you can include stamp duty, registration charges, and GST paid during the purchase of the property as part of the cost of acquisition. These are considered incidental expenses to the property purchase and can be added to the purchase cost, reducing your Short-Term Capital Gain (STCG).

In your case:
Stamp Duty: ₹8.4 lakh
GST: ₹6.8 lakh
By adding these amounts (₹15.2 lakh) to the purchase price of ₹1.36 Cr, the effective cost of acquisition becomes ₹1.512 Cr. This will reduce your STCG accordingly.

Unfortunately, buying a new property does not exempt you from paying tax on Short-Term Capital Gains (STCG). The tax benefits under Sections 54 and 54F for reinvesting in a new residential property only apply to Long-Term Capital Gains (LTCG), i.e., if you've held the property for more than 24 months.

Since your holding period is less than 24 months, the profit is treated as Short-Term Capital Gain, and there are no specific exemptions available under the Income Tax Act for STCG, even if you reinvest in another property. Therefore, you'll need to pay tax on the STCG as per your income slab.

Regards