Question 1

What is the LTCG tax rate on property sale in India FY 2026-27?

Accepted Answer

Long-term capital gains (LTCG) on immovable property are taxed at 12.5% without indexation benefit under Section 112 as amended by Finance (No. 2) Act, 2024 (w.e.f. 23 July 2024). Alternatively, for property acquired before 23 July 2024, taxpayers can opt for 20% with indexation if it results in a lower tax liability.

Question 2

What is the holding period for LTCG on property?

Accepted Answer

Immovable property (land and building) is long-term if held for more than 24 months (2 years) from date of acquisition [Section 2(42A)].

Question 3

What is the LTCG tax rate on equity shares and mutual funds?

Accepted Answer

LTCG on listed equity shares and equity-oriented mutual funds exceeding ₹1.25 lakh per year is taxed at 12.5% under Section 112A (no indexation). This threshold was increased from ₹1 lakh to ₹1.25 lakh by Finance (No. 2) Act, 2024 w.e.f. 23 July 2024.

Question 4

What is the STCG tax rate on equity shares in FY 2026-27?

Accepted Answer

Short-term capital gains on listed equity shares and equity-oriented MFs (where STT is paid) are taxed at 20% under Section 111A. This rate was increased from 15% to 20% by Finance (No. 2) Act, 2024 w.e.f. 23 July 2024.

Question 5

What is Section 54 exemption for capital gains?

Accepted Answer

Section 54 exempts LTCG on residential house property if the proceeds are reinvested in purchasing/constructing another residential house in India within the prescribed time — purchase within 1 year before or 2 years after sale; construction within 3 years. Maximum exemption capped at ₹10 crore (w.e.f. AY 2024-25).

Question 6

What is Section 54EC exemption?

Accepted Answer

Section 54EC exempts LTCG on immovable property (land/building) if the gain is invested in specified bonds — NHAI or REC bonds — within 6 months of sale. Maximum investment and exemption is capped at ₹50 lakhs. Lock-in period is 5 years.

Asset Class	Holding for LTCG	STCG Rate	LTCG Rate	Section	Indexation?
Immovable Property (land/building)	> 24 months	Slab rates	12.5% (or 20% w/ index if pre-23 Jul 24)	112	Option for pre-23 Jul 2024
Listed Equity Shares (STT paid)	> 12 months	20% [Sec 111A]	12.5% above ₹1.25L [Sec 112A]	111A / 112A	No
Equity-Oriented MF (STT paid)	> 12 months	20% [Sec 111A]	12.5% above ₹1.25L [Sec 112A]	111A / 112A	No
Unlisted Equity Shares	> 24 months	Slab rates	12.5% [Sec 112]	112	No
Debt MF (units purchased ≥ 1 Apr 2023)	N/A	Slab rates	Slab rates	—	No
Debt MF (units purchased < 1 Apr 2023, held >36 months)	> 36 months	Slab rates	20% [Sec 112]	112	Yes (grandfathered)
Gold ETF / Sovereign Gold Bond (SGB)	> 12 months (SGB: 8 yrs exempt)	Slab rates	12.5%	112	No
Bonds / Debentures (listed)	> 12 months	Slab rates	12.5%	112	No

Section	Asset	Reinvestment Required	Cap	Time Limit
54	Residential house property → residential house	Purchase new house (1 before / 2 years after) or construct within 3 years	₹10 crore (w.e.f. AY 2024-25)	6 months before return due date for CGAS deposit
54EC	Any immovable property → NHAI / REC bonds	Specified bonds (5-yr lock-in)	₹50 lakh	Within 6 months of transfer
54F	Any asset (other than house) → residential house	Net consideration reinvested in residential house	₹10 crore (w.e.f. AY 2024-25)	1 yr before / 2 yrs after (purchase); 3 yrs (construction)
54B	Agricultural land → agricultural land	New agricultural land within 2 years	Full gain	2 years from transfer

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Capital Gains Tax Rates — FY 2026-27 (AY 2027-28)

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