Here’s a detailed breakdown of the tax rates on long-term capital gains (LTCG) for assets not covered under Section 112A (i.e., non-equity assets like real estate, unlisted shares, debt funds, etc.), incorporating the latest updates from Budget 2024 and applicable provisions under Section 112 of the Income Tax Act:
1. Applicable Assets Under Section 112
- Listed securities(where STT is not paid on acquisition/transfer, e.g., bonds, debentures).
- Unlisted securities/shares(holding period: 24+ months).
- Immovable property(land/building held for 24+ months).
- Zero-coupon bonds(12+ months).
- Other capital assets(e.g., gold, art, collectibles).
2. Tax Rates (Effective from 23rd July 2024)
| ASSET TYPE | PRE-23/07/2024 RATE | POST-23/07/2024 RATE | INDEXATION BENEFIT? |
| Listed securities (non-STT) | 10% (no indexation) or 20% (with indexation) | 12.5% (no indexation) | No |
| Unlisted securities | 20% (with indexation) | 12.5% (no indexation) | No |
| Immovable property | 20% (with indexation) | 12.5% (no indexation) or 20% (with indexation)* | Optional* |
| Zero-coupon bonds | Lower of 10% or 20% | 12.5% (no indexation) | No |
| Other capital assets | 20% (with indexation) | 12.5% (no indexation) | No |
*For immovable property acquired before 23/07/2024, taxpayers can choose between 12.5% (no indexation) or 20% (with indexation) 59.
3. Key Changes Post-Budget 2024
- Uniform 12.5% ratefor most LTCG (except Section 112A assets).
- Indexation benefit removedfor most assets (except land/building acquired pre-23/07/2024).
- Simplified holding periods: Only 12 months(listed securities) or 24 months (other assets).
4. Calculation of LTCG
LTCG = (Sale Price) – (Indexed Cost of Acquisition*) – (Transfer Expenses)
*Indexed cost = Original cost × (CII Year of Sale / CII Year of Purchase).
Example: Property bought for ₹20L in 2005 (CII: 117) sold in 2024 (CII: 363) for ₹65L:
- Indexed cost = ₹20L × (363/117) = ₹62.05L.
- LTCG = ₹65L – ₹62.05L = ₹2.95L → Tax @20% = ₹59,000 (if indexation chosen).
- Without indexation: LTCG = ₹45L → Tax @12.5% = ₹5.62L 5.
5. Special Provisions
- Basic exemption limit: Resident individuals/HUFs can adjust LTCG against unused basic exemption (₹2.5L under old regime).
- No Chapter VI-A deductions(e.g., 80C, 80D) against LTCG.
- Loss set-off: LTCL can only be set off against LTCG (carry forward for 8 years).
6. Reporting Requirements
- File ITR-2/ITR-3with details in Schedule CG (sale value, indexed cost, exemptions under Sections 54/54F/54EC).
For assets like debt funds, note that indexation benefits were removed from April 2023, making them taxable at slab rates.
