How are capital gains taxed?
Suppose you buy an asset, hold it for a while and then sell it at a higher price, you make a capital gain. In the case of equities or equity mutual funds, if you sell an asset after one year, your gain is called long-term capital gain (LTCG). If you sell it within a year, you make short-term capital gain (STCG). The current tax on LTCG is zero. STCG is taxed at 15%. In the case of debt funds, the qualifying period for LTCG is 36 months. STCG is taxed at slab rates, while LTCG is taxed at 20% with indexation benefit. Gold and property are taxed at the same rate.
What could happen in the Budget?
The Prime Minister recently said those profiting from the stock markets should contribute more to nation building. Since then, there is speculation that the holdingperiod for ascertaining LTCG on equities could be increased, and the STCG rate could be raised.
Suppose you buy an asset, hold it for a while and then sell it at a higher price, you make a capital gain. In the case of equities or equity mutual funds, if you sell an asset after one year, your gain is called long-term capital gain (LTCG). If you sell it within a year, you make short-term capital gain (STCG). The current tax on LTCG is zero. STCG is taxed at 15%. In the case of debt funds, the qualifying period for LTCG is 36 months. STCG is taxed at slab rates, while LTCG is taxed at 20% with indexation benefit. Gold and property are taxed at the same rate.
What could happen in the Budget?
The Prime Minister recently said those profiting from the stock markets should contribute more to nation building. Since then, there is speculation that the holdingperiod for ascertaining LTCG on equities could be increased, and the STCG rate could be raised.
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