Starting this month, we will provide insights from Union Budget 2024, as a response to the many requests on the topic by our clients. This is the first post in a multiple series of posts:
The impact of the Budget 2024 on Capital Gains.
•Four step process aimed at rationalizing and simplifying capital gains tax regime:
•First – Holding period: Only two holding periods to determine long term or short-term capital gains: 12 months and 24 months
•Second – rationalized/increased tax rates: Short term capital gains rate increased from 15% to 20% in certain categories and long-term capital gains rate rationalized (from 20% and 10% to 12.5%); Exemption limit for LTCG on transfer of equity shares, equity oriented Mutual funds and units of business trust- increased from 1 lakh to 1.25 lakhs.
•Third – Indexation benefits: Indexation benefits available for, gold and other unlisted assets removed
•Amendment: Resident Individuals and HUF- Real estate property- For real property sold before July 23, 2024, taxpayers can opt for computing capital gains with indexation at 20% capital gains tax or 12.5% capital gains tax but withotu indexation. No indexation benefit for property sales after July 23, 2024.
•Fourth – parity in tax rates: Capital gains tax rate between residents and non-residents now at par.
For more information on how the components of the new union budget would impact you, connect with us at :[email protected].
