Capital Gains

Capital Gains Tax in India After July 2024: The New Rules Explained

By CA Aman Singhal28 May 20266 min read

The Finance Act 2024 overhauled how capital gains are taxed in India, effective 23 July 2024. If you have sold — or plan to sell — shares, mutual funds or property, here is what changed and what it means for your tax.

Listed shares & equity mutual funds

Short-term (held ≤ 12 months): STCG is now 20% (up from 15%).
Long-term (held > 12 months): LTCG is now 12.5% (up from 10%), and the annual exemption rose to ₹1.25 lakh (from ₹1 lakh).

Property, gold & unlisted assets

The big change here is the removal of indexation. Long-term gains (property held > 24 months) are now taxed at a flat 12.5% without indexation, instead of the old 20% with indexation.

The grandfathering option: for land or buildings acquired before 23 July 2024, resident individuals and HUFs can choose whichever is lower — 20% with indexation or 12.5% without. For older properties with large indexed cost, the old method can still win, so always compare both.

Debt mutual funds

Debt funds bought after 1 April 2023 have no long-term benefit at all — gains are added to your income and taxed at your slab rate, regardless of holding period.

Ways to save on LTCG

Section 54 / 54F: reinvest gains from property (or other assets) into a residential house to claim exemption.
Section 54EC: invest up to ₹50 lakh of property LTCG in NHAI/REC bonds within 6 months (5-year lock-in) to save the tax entirely.
Harvest the ₹1.25 lakh equity LTCG exemption every year.

Worked example: sell equity held 2 years with a ₹3 lakh gain — the first ₹1.25 lakh is exempt, and the remaining ₹1.75 lakh is taxed at 12.5% = ₹21,875 (plus cess).

Capital gains tax is full of edge cases — holding periods, asset types and the indexation choice all change the answer. Use our Capital Gains Calculator to get an instant estimate, or have a CA plan the sale to legally minimise the tax.

Try the Capital Gains CalculatorFree, CA-verified, runs in your browser.

This article is for general information based on provisions for FY 2025-26 and is not individual tax advice. Rules change and exceptions apply — please confirm with a qualified Chartered Accountant before acting.