LTCG Tax Amendment Proposal Brings Relief to Real Estate Sector
Real estate industry leaders welcome Finance Minister Nirmala Sitharaman's proposed amendment to the Finance Bill, which aims to provide significant relief on capital gains tax in property transactions.
Ltcg TaxReal EstateCapital Gains TaxNirmala SitharamanFinance BillReal EstateAug 07, 2024
The government's initiative to allow taxpayers the option to compute taxes either at 12.5 per cent without indexation or at 20 per cent with indexation on real estate transactions is a significant step forward. This relief applies to the transfer of long-term capital assets, such as land or buildings, acquired before July 23, 2024.
Frequently Asked Questions
What is the proposed amendment to the Finance Bill?
The proposed amendment will enable taxpayers to compute taxes either at 12.5 per cent without indexation or at 20 per cent with indexation on real estate transactions.
What is the cut-off date for the calculation of capital gains?
July 23, 2024, is now set as the cut-off date for the calculation of the capital gains versus the earlier cut-off of 2001.
How will the amendment affect the real estate sector?
The amendment is expected to stimulate investment in the real estate sector and boost sales across all housing segments.
What is the current LTCG tax rate on property?
The current LTCG tax rate on property is 12.5 per cent, down from 20 per cent earlier.
What is indexation and how does it affect capital gains tax?
Indexation is the adjustment of the acquisition cost for inflation before computing capital gains, which reduces the overall tax burden.
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