Budget 2024: New rules for Capital Gains Tax have come into effect, CBDT explained the whole thing through FAQ..
New Capital Gains Tax Rules: On July 23, Finance Minister Nirmala Sitharaman changed the rules of Capital Gains Tax in the Union Budget 2024-25. In this budget, a proposal was presented to change the capital gains tax rate and holding period of many assets along with immovable properties.
Capital gains tax is levied on the profit from any property or asset. After the change in the rules of capital gains tax, many people are very confused about the new rule. In such a situation, to remove their confusion, the Central Board of Direct Taxes (CBDT) issued an FAQ. All the information related to the new rules of capital gains tax has been given in this FAQ.
What are the major changes in tax capital gains?
It was proposed to change the rules to simplify the capital gains tax. The government has taken into account 5 criteria in their rules.
The holding tenure has been simplified in the new rules. Now there are only two holding tenures (1 year, 2 years).
Changes have been made to rationalize and make the rates of many assets uniform.
The rates for calculation have been increased from 12.5 percent to 20 percent.
Changes have also been made to bring equality between Indian residents and non-residents.
No change has been made in the rollover benefit.
When will the new rules be implemented?
The new rules for capital gains tax have come into effect from 23 July 2024. This means that after 23 July 2024, capital gains tax will be levied under the new rules for any transfer.
How will the holding tenure be simplified?
Changes have also been made in the holding tenure in the budget. Earlier the holding tenure used to be 3 periods, now it has been made two to make it easier. It has been made one year for listed securities and two years for unlisted securities.
The investor will benefit from this because now the period of 36 months for listed entities like business trusts has been reduced to 12 months. At the same time, the holding of unlisted securities has been reduced from 36 months to 24 months. Let us tell you that there has been no change in the holding period of immovable property and unlisted shares. It is 24 months i.e. 2 years as before.
What changes have been made in the rates of paid capital gain tax?
The rates of short-term STT paid listed equity, equity-oriented mutual funds and units of business trusts have been changed. They have been increased from 15 percent to 20 percent. At the same time, the rate structure of the tenure of long-term assets has also been changed. It has been increased from 10 percent to 12.5 percent.
The rate of long-term capital gain tax has also been changed. It has been reduced from 20 percent to 12.5 percent. This decision was taken to simplify the system and calculation of capital gains tax.
What has changed in the exemption limit of long-term capital gains tax?
There has also been a change in the Long Term Capital Gain Tax (LTCG). In this, the exemption limit of 1 lakh has been increased to Rs 1.25 lakh. The new exemption limit has been implemented for the financial year 2024-25 or subsequent years.
Will the investor get the benefit of rollover benefit?
The investor will continue to get the benefit of rollover benefit. No change has been made to this. The investor can avail of the roll over benefit by fulfilling the conditions.
To avail of the roll over benefit, the investor has to invest in a bond under section 54, section 54F, or section 54EC. The benefit of rollover will be available only under sections 54, 54B, 54D, 54EC 54F, and 54G of the Income Tax Act. Let us tell you that under section 54EC, a rollover benefit of up to Rs 50 lakh is available. The benefit is available subject to the conditions specified in the rest of the sections.
Follow our Whatsapp Channel for latest update
