Uniform LTCG Duration For Equity, Property, Gold Likely In Budget


This will likely be a serious coverage intervention as at the moment the LTCG for fairness is at 1 12 months, 2 years for property and three years for gold. Though it isn’t but recognized, the tax therapy for LTCG may additionally see the resultant modifications.


New Delhi: In a serious transfer, the federal government is more likely to stipulate a uniform framework for all asset classes-equity, property and gold-for computation of capital features. Among the Budget proposals being thought of for the Union Budget is that the long run capital features (LTCG) tax will likely be mounted at 24 months or two years uniformly for all asset courses.

This will likely be a serious coverage intervention as at the moment the LTCG for fairness is at 1 12 months, 2 years for property and three years for gold. Though it isn’t but recognized, the tax therapy for LTCG may additionally see the resultant modifications.

These asset courses roughly are the bulwark of the funding ecosystem within the nation and a regular LTCG computation would introduce transparency and supply extra readability and ease of the regime for traders.

On gold, long run capital features after sale of gold kicks in after three years and is levied at 20 per cent plus indexation advantages. The quick time period capital features is levied at sale of gold on a time length of lower than three years and is levied as per the tax slab of the assessee.

Profit from sale of gold bars, jewelry, cash or utensils or every other type of treasured steel attracts tax below capital features. The revenue on sale of gold holding is taxable below the top “Capital Gains” of Income Tax. Only exception to that is in case of gold sellers who transact in gold as part of their enterprise, the place revenue on such transactions is taxable below the top “Income from business or profession”.

On property, at the moment, if property is offered inside 24 months, one has to pay a brief time period capital features tax (STCG) on the features as per a person’s income-tax slab.

After 24 months, one has to pay an LTCG tax, which is charged at 20% with indexation advantages. Section 54 offers an exemption if there’s sale of a property after which one other one is purchased.

This exemption below part 54 is offered when the capital features from property sale are reinvested into shopping for or establishing most two homes.

However, the capital features on the sale of home property should not exceed Rs 2 crore with a purpose to declare exemption for reinvesting in two properties. This profit could be claimed solely as soon as within the lifetime.

The exemption will likely be reversed if this new property is offered inside three years of buy and capital features from sale of the brand new property will likely be taxed as short-term capital features. The new properties should be bought both one 12 months earlier than the sale or two years after the sale of the property. Alternatively, the brand new residential properties should be constructed inside three years of sale of the property.

In a transfer that may hearth up the inventory markets, the federal government is more likely to prolong the timeline of long run capital features (LTCG) on shares from the present 12 months to 24 months.

Currently, LTCG of 20 per cent is paid by home traders in the event that they maintain fairness for 12 months, and 10 per cent is charged to non-residents in the event that they maintain fairness for 12 months.



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