LTCG Tax

July 2024 steps will shape tax deductions and exemptions that can be claimed when filing an Income Tax Return (ITR) in July 2025

Strong outlook for gold, absence of SGB issuances also among factors

LTCG tax perks and bond drought create perfect storm

The original LTCG regime proposed on July 23 Budget, removed the indexation benefit, sparking concerns over real estate transactions

In Budget 2024, FM Sitharaman proposed an overhaul in the capital gains tax regime, including lowering the LTCG tax to 12.5% from 20%

Finance Minister Nirmala Sitharaman on Wednesday said the contentious LTCG tax proposal on real estate is being amended to give option to taxpayers to compute tax liability under the old system or at reduced rates without indexation, and pay the lower of the two. Replying to a debate on the Finance Bill, Finance Minister Nirmala Sitharaman said the rollover benefit will be available to taxpayers who buy new immovable property utilising the capital gains on the sale of old property. The Budget 2024-25 proposal to remove indexation benefit in calculation of long term capital gains on sale of immovable properties evoked sharp criticism from various corners, including opposition parties and tax professionals. The Budget, presented on July 23, had proposed a lower 12.5 per cent rate of LTCG tax, down from 20 per cent, while doing away with the indexation benefit. The major amendment in the Bill relates to restoration of indexation benefit on sale of properties bought prior to July 23, .

Effectively gives grandfathering provision for property transactions before July 23

FinMin reviews new LTCG regime after 12.5% tax without indexation sparks concerns over property transactions

From the July 23 Budget 2024-day low, the midcap and the smallcap indices on the BSE have seen a surge of over 6 per cent and 7 per cent respectively

Holding period, quantum of gain to decide if new norms are beneficial

The income tax department on Wednesday issued a FAQ on changes in the capital gains tax saying the idea behind it was to simplify the tax structure and promote ease of compliance. The holding period for various asset classes for the purpose of short- and long-term capital gains tax has been rationalised. The holding period of all listed assets will be now one year for the purpose of long-term capital gains tax (LTCG). Therefore, for listed units of business trusts (ReITs, InVITs) holding period is reduced from 36 months to 12 months. The holding period of gold, unlisted securities (other than unlisted shares) is also reduced from 36 months to 24 months for calculating LTCG. The holding period of immovable property and unlisted shares remains the same as earlier i.e. 24 months. "Simplification of any tax structure has benefits of ease of compliance viz computation, filing, maintenance of records. This also removes the differential rates for various classes of assets," the income tax

Union Budget 2024 analysis: The government has laid out a clear vision for 'Viksit Bharat' by addressing key areas - agricultural reforms, manufacturing push and employment generation among others

To mitigate the blow from the increased taxes, the amount exempted from the LTCG on listed securities has been increased to Rs 125,000 a year from the earlier limit of Rs 100,000

According to MF officials, these offerings had unintentionally got classified as debt funds last year, and this budget makes a course correction

India Budget 2024-25 News Highlights: By raising LTCG tax to 12.5 per cent and STCG tax to 20 per cent, the overhang for stock markets gets removed

Union Budget 2024: Several people took to social media platform X (formerly Twitter) to criticise the move, noting that it is painful for stock market investors

Union Budget 2024-25 news: FM Nirmala Sitharaman hiked hiked LTCG tax to 12.5 per cent from 10 per cent on all financial and non-financial assets

In the worst-case scenario, the Sensex can slide to 75,800 levels, which is the 50 per cent retracement level from the June 4 Lok Sabha election outcome-day low, said Ajit Mishra of Religare Broking.