4 Easy steps to remember capital gain tax rates in India

Did you find challenges in remembering different capital gain tax rates in India?

Indeed its sometime confusing for gerneral person with so many different variation of rates. Although for tax advisor its on tips because they deal in to this matter on daily basis.

In this article, Our teammate Ravi Saini and me have tried to make a simplified version to remember what are different types of Capital Gain tax (CGT) rates in india.

Income tax on Capital Gain is levied after establishing whether the capital asset is short term or long term as per following criteria. So let's start fisrt to understand 1st question.

How to defferenciate Long term capital assets and short term assets?

Group A

Disposal of Assets	Short term capital assets	Long term capital assets
Listed security ( except debt units)	If held for <=12 months	If held for > 12 months
Units of equity oriented funds/ UTI	If held for <=12 months	If held for > 12 months
Zero capital bond	If held for <=12 months	If held for > 12 months

Group B

Disposal of Assets	Short term capital assets	Long term capital assets
Unlisted Shares	If held for <=24 months	If held for > 24 months

Group C

Disposal of Assets	Short term capital assets	Long term capital assets
Land or building or both	If held for <=24 months	If held for > 24 months

Group D

Disposal of Assets	Short term capital assets	Long term capital assets
Unit of debt oriented fund	If held for <=36 months	If held for > 36 months
Unlisted securities other shares	If held for <=36 months	If held for > 36 months
Other capital assets	If held for <=36 months	If held for > 36 months

Conclusion of Tax rates

Tax on Short term Capital Gains in respect of:

• Equity shares, units of an equity oriented fund, UTI units (sec 111A) = 15%
• Other assets = to be taxed as per tax slab applicable to person

Tax on Long term Capital Gains in respect of:

• Listed securities

  • For Capital Gain upto ₹1 lakh = NIL
  • For Capital Gain more than ₹1 lakh = 10%

• Other assets = 20%

Note: While calculating long term capital gain on assets other than listed securities, indexation benefits are also available.

Disclaimer:
The information contained in this article is for general information purposes only and does not constitute legal advice, Whilst we endeavour to keep the information up-to-date and correct, we make no representations or warranties of any kind, express or implied, about the completeness, accuracy, reliability, suitability for a particular purpose. We recommend that professional advise should be taken from a suitably qualified expert before undertaking any action.

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