Section 54 → Section 70
Exemption on sale of Residential House
Quick Answer
Section 54 of the Income Tax Act, 1961 (Exemption on sale of Residential House) corresponds to Section 70 of the Direct Tax Code 2025 (Income-tax Act, 2025), effective 1st April 2026. Status: Retained.
Sec 54
Provision Summary
Capital gains from selling a residential house are exempt if reinvested in another residential house within specified timeframes.
Sec 70
Provision Summary
Retained but capped. The maximum deduction allowed under this section is strictly capped at Rs. 10 Crores to prevent ultra-rich tax avoidance.
Key Changes & Highlights
- Capital Gains Account Scheme (CGAS) deposits now tracked via PAN to monitor the 3-year utilization deadline automatically.
Related Sections
Related Articles from the Tax Academy
chapter via deductions
Section 54 Exemption: Is the Rs 10 Crore Cap Still Valid in 2026?
Expert analysis of the Rs 10 crore cap on Section 54 capital gains exemption under the new Direct Tax Code 2025. Learn how it impacts real estate investors and HNIs.
chapter via deductions
Section 54 Exemption: Is the Rs 10 Crore Cap Valid for Tax Year 2026?
Expert analysis on the Rs 10 crore cap on Section 54 capital gains exemption under the Income Tax Act. Understand its impact, ITR filing steps, and the status of the Direct Tax Code for 2026.
chapter via deductions
Section 54EC Bonds Under New Tax Law 2025: Is Your 5-Year Lock-in Still Valid?
Expert analysis on how the Direct Tax Code 2025 impacts Section 54EC capital gains bonds. Find out if the 5-year lock-in is still mandatory in 2026 and who is affected by the new rules.
chapter via deductions
Section 54 Exemption: Is the Rs 10 Crore Cap Still Valid in 2026?
Expert analysis on the Rs 10 crore cap on capital gains exemptions under Section 54 & 54F for tax year 2026. Understand the rules, impact, and ITR filing steps under the current Income Tax Act.
general transition
Complete Guide to the New Income Tax Act 2025: Section Changes
A professional compliance guide on the transition from the Income Tax Act 1961 to the new Direct Tax Code 2025, effective April 1, 2026. Understand section changes and prepare for the 2025 income tax sunset.
general transition
Capital Gains Account Scheme (CGAS) Under Direct Tax Code 2025
A professional compliance guide on transitioning your Capital Gains Account Scheme (CGAS) from the Income Tax Act 1961 to the new Direct Tax Code 2025. Understand key changes, new rules, and compliance actions.
Frequently Asked Questions
What does Section 54 of the Income Tax Act 1961 deal with?
Section 54 (Exemption on sale of Residential House) Capital gains from selling a residential house are exempt if reinvested in another residential house within specified timeframes.
What is the new section number for Section 54 under the Direct Tax Code 2025?
Section 54 of the ITA 1961 maps to Section 70 of the Direct Tax Code 2025 (Income-tax Act, 2025), effective from 1st April 2026.
What is the status of Section 54 under the new tax code?
Section 54 is marked as "Retained" with status "Modified". Impact: High - The most common tax-saving tool for home sellers.
What are the key changes to Section 54 under DTC 2025?
Capital Gains Account Scheme (CGAS) deposits now tracked via PAN to monitor the 3-year utilization deadline automatically.
Disclaimer: This page is for educational and reference purposes only. Section mappings are based on publicly available drafts and circulars. Always consult a qualified Chartered Accountant before filing or making compliance decisions under the Direct Tax Code 2025.
Need professional help on Section 54?
Compare trusted providers — both offer DTC 2025-ready CA services.
*Affiliate links — we may earn a small commission at no extra cost to you. Disclosure.
Want to calculate tax on this section?