Home > Publications > Budget Analysis

Capital Gains:

Under Section 54EC of the I-T Act the FM has imposed a cap of Rs. 50 Lakh on tax exemption for long term capital gains form sale of property.

Suppose you sell some property and make, say, a gain of a crore, you can save tax upto Rs. 50 Lakh by investing in National Highways Authority of India and Rural Electrification Corporation. You will be required to pay capital gains tax of 20% on the remaining amount, provided you have held the property for atleast 3 Years. There’s another catch: you should hold the bonds for atleast 3 years to avail of the tax exemption. Incase you hold the property for less than that, gain from its sale will be treated as income and taxed accordingly , at 30% if your income falls into highest bracket.

Back To Budget Analysis