AMENDMENT TO PROVIDE RELIEF FOR REAL ESTATE UNDER LTCG REGIME

In a move aimed at easing the tax burden on real estate transactions, the government has introduced an amendment to the Long-Term Capital Gains (LTCG) regime. This change brings significant relief for taxpayers dealing with the taxation of immovable property, allowing for a more flexible approach to calculating capital gains.

KEY PROVISIONS OF THE AMENDMENT:

 1. APPLICABILITY:

• This relief is available to individuals and Hindu Undivided Families (HUF) who are transferring long-term capital assets, specifically land or buildings, or both.

2. CHOICE OF TAXATION SCHEME:

• Taxpayers now have the option to compute their taxes under either the new scheme (12.5% without indexation) or the traditional scheme (20% with indexation).
• The scheme that results in the lower tax amount will be applicable, providing greater flexibility and potential savings.

 3. EFFECTIVE DATE:

• The new provisions apply to properties acquired before July 23, 2024.

This amendment allows for significant flexibility, enabling taxpayers to choose the tax scheme that best suits their financial situation. By offering a choice between a lower rate with no indexation or a higher rate with indexation, the government aims to alleviate some of the financial pressure on those dealing with long-term capital gains from immovable property.