Real Estate: The new LTCG tax regime although comes without indexation benefits but…
Perspective by Mr. Nitin Bavisi, CFO, Ajmera Realty & Infra India Ltd on the revision in LTCG indexation norms on sale of Properties
"The decision to offer tax-payers a choice to pay 20% LTCG tax with indexation benefits or 12.5% sans indexation on the sale of property acquired before 23rd July 2024 is a commendable move that will firm the trust of the taxpayers and real estate investors. The new LTCG tax regime although comes without indexation benefits but can be of significant benefits, subject to the appreciation at the point of selling the property.
The concern pertaining to higher LTCG tax liability on property sales had raised a sense of anxiety among the investors, especially for the properties that were acquired before the prescribed date. The provision of this choice is a landmark development towards keeping the taxpayers' and investors' sentiment at the epicentre and will give a major boost to investments in the real estate sector across housing segments.
Additionally, the rollover benefits remain intact which means that if capital gains are invested, deductions under Sections 54, 54F and 54EC for buying or constructing residential real estate up to specified limits, LTCG would continue to be exempt from tax.
Overall, this move is set to greatly benefit the real estate sector and its stakeholders, fuelling robust growth and dynamic expansion across the industry."
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