Long-Term Capital Gains on Indian Property After the Finance Act 2024
The Finance Act 2024 replaced 20%-with-indexation by 12.5%-without-indexation for property. For most post-2015 purchases the new rate is better; for long-held legacy property it often is not — which is why the grandfathering election matters.
LTCG rate (no indexation)
12.5%
Long-term holding period
24 mo
Grandfathered alternative
20%
Section 54 exemption cap
₹10 Cr
What the data says
Property held over 24 months is long-term; gains are taxed at 12.5% without indexation.
Resident individuals and HUFs may elect the old 20%-with-indexation computation for property acquired before 23 July 2024, and pay the lower of the two.
The election is per-property, so a portfolio exit should be modelled asset by asset.
How EstateVeda executes this
Dual computation on every asset — new regime versus grandfathered regime.
Cost-of-improvement substantiation, which is routinely under-claimed.
Section 54 / 54F / 54EC reinvestment planning before registration, not after.
Advance-tax scheduling so the liability does not attract 234B/234C interest.
Risks we underwrite against
Missing the grandfathering election on legacy property bought in the 1990s.
Claiming improvement costs without invoices or bank trail.
Treating stamp-duty value versus agreement value differences as ignorable — Section 50C applies.
EstateVeda verdict
Run both computations. On pre-2010 acquisitions the grandfathered 20%-with-indexation route still wins more often than not.
Frequently asked questions
What is the LTCG tax rate on property in India in 2026?
12.5% without indexation on gains from property held longer than 24 months. Resident individuals and HUFs may instead elect 20% with indexation for property acquired before 23 July 2024 and pay the lower amount.
How do I save LTCG tax on property sale?
Section 54 (reinvest in residential property, capped at ₹10 Cr), Section 54F (sale of non-residential asset), and Section 54EC (up to ₹50 lakh in specified bonds within 6 months).
What is the holding period for long-term treatment?
24 months for immovable property. Below that, gains are short-term and taxed at slab rates.