07-Aug-2024
2 mins read
.jpg)
.jpg)
The Indian Government has amended the Finance Bill 2024 and stated that the LTCG regime for real estate allows taxpayers to choose between a lower tax rate of 12.5% without indexation or a higher tax rate of 20% with indexation for the properties acquired before July 23 2024.
It enables HUF and individuals to compute their taxes on both schemes and pay the lower amount. This amendment offers LTCG a big relief in the case of immovable properties like houses, land, buildings, and unlisted securities. No LTCG relief is proposed for listed equity shares and equity-oriented mutual funds.
Not just real estate indexation, the government has also proposed to revert to 10% LTCG for unlisted securities bought before July 23. The Finance Bill had proposed raising it to 12.5%.
The recent amendment rules are applicable from July 23, 2024. It's important to note that properties acquired before 2001 will continue to benefit from indexation. This means that only recent acquisitions will be subject to the new rules. If you complete any transactions before the mentioned date, they will not be impacted by the new regulations.
Before the Budget 2024, indexation benefits helped homeowners to increase the property's cost basis to account for inflation, thereby reducing the net profit and the associated tax liability.