Question 1

What is the LTCG tax rate on equity in India after Budget 2024?

Accepted Answer

After the Union Budget 2024, long-term capital gains (LTCG) on equity shares and equity mutual funds are taxed at 12.5% for gains exceeding Rs. 1.25 lakh per financial year. Gains up to Rs. 1.25 lakh are fully exempt under Section 112A. The holding period for equity to qualify as long-term remains 12 months. Short-term capital gains (STCG) on equity are taxed at 20%.

Question 2

How are capital gains on property taxed in India?

Accepted Answer

Property held for more than 24 months qualifies as a long-term capital asset. LTCG on property is taxed at 12.5% (post Budget 2024). STCG on property (held less than 24 months) is taxed at your income tax slab rate. You can save tax on property LTCG by reinvesting in another residential property under Section 54 or in capital gains bonds under Section 54EC.

Question 3

Are debt mutual fund gains still taxed at slab rate?

Accepted Answer

Yes, since the April 2023 amendment, gains from debt mutual funds are taxed at your applicable income tax slab rate regardless of the holding period. The earlier benefit of indexation for debt funds held over 3 years has been removed. This applies to all debt-oriented mutual funds including liquid funds, ultra-short duration funds, and corporate bond funds.

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