Budget 2024 significantly restructured capital gains tax in India — raising LTCG tax to 12.5% (from 10%), changing holding periods, and removing indexation for most assets from FY 2024–25. Understanding these changes is crucial before filing ITR for FY 2025–26.
Capital Gains Tax Rates (Updated for FY 2025–26)
| Asset Type | Holding Period | STCG Rate | LTCG Rate |
|---|---|---|---|
| Equity shares / Equity MF (listed) | < 12 months = Short; ≥ 12 months = Long | 20% (Sec 111A) | 12.5% above ₹1.25L (Sec 112A) — NO indexation |
| Debt Mutual Funds (post Apr 2023) | All treated as Short Term | Slab rate | N/A (no LTCG benefit) |
| Immovable property (land, house) | < 24 months = Short; ≥ 24 months = Long | Slab rate | 12.5% without indexation OR 20% with indexation (pre-Jul 2024 purchases) |
| Unlisted shares | < 24 months = Short; ≥ 24 months = Long | Slab rate | 12.5% (Sec 112) |
| Gold / Gold ETFs | < 24 months = Short; ≥ 24 months = Long | Slab rate | 12.5% |
| Crypto / VDA | No holding period benefit | 30% + surcharge + cess | 30% always |
| NPS / PPF | Exempt | Exempt | Exempt |
Indexation — What Changed in Budget 2024
Before Budget 2024 (July 23, 2024): Property, unlisted shares, and gold had 20% LTCG WITH indexation. After the budget, indexation was removed — LTCG is now 12.5% WITHOUT indexation. However, for properties purchased BEFORE July 23, 2024, sellers can choose: either 12.5% without indexation OR 20% with indexation — whichever is lower.
Section 54 and Other LTCG Exemptions on Property
| Section | Asset Sold | Exemption Condition | Limit |
|---|---|---|---|
| 54 | Residential house | Buy another house in 1 year before / 2 years after / construct in 3 years | Capital gains amount (one house max) |
| 54EC | Any long-term asset | Invest in NHAI/REC bonds within 6 months | ₹50 lakh maximum |
| 54F | Any long-term asset (except house) | Purchase residential house | Proportionate exemption |
| 54B | Agricultural land | Buy agricultural land within 2 years | Capital gains amount |
How to Report Capital Gains in ITR
- Download Capital Gains Statement from broker (Zerodha, Groww, etc.) or fund house
- For mutual funds: Download CAS from CAMS/KFintech — includes all fund house data
- Fill Schedule CG in ITR-2 or ITR-3 — separate computation for each asset class
- Enter LTCG on equity: Section 112A (listed) — only gains > ₹1.25 lakh are taxable
- Crypto/VDA: Report in Schedule VDA — no deductions, no loss set-off allowed
- Property sale: Report in Part B (LTCG) with purchase cost and improvement cost
Note: Capital gains computation can be complex with multiple transactions. A CA-reviewed filing significantly reduces notice risk and ensures you don't miss legitimate exemptions.