If you sell a house within 24 months, you have to pay an STCG tax on the gains as per your income-tax slab. After 24 months, you have to pay an LTCG tax, which is charged at 20% with indexation benefits. Section 54 gives you an exemption if you sell a property and buy another one.

Is selling a house a long term capital gain?

If you sell an asset you held for more than a year, any profit is considered a long-term capital gain. This is quite common in real estate. Long-term gains have their own tax brackets and are generally taxed at lower rates than ordinary income and short-term gains.

Do senior citizens have to pay capital gains tax in India?

Residential Indians between 60 to 80 years of age will be exempted from long-term capital gains tax in 2021 if they earn Rs. 3,00,000 per annum. For individuals of 60 years or younger, the exempted limit is Rs. 2,50,000 every year.

How can I avoid capital gains tax on property sale in India?

However, you can substantially reduce it by using one of the following methods:

1. Exemptions under Section 54F, when you buy or construct a Residential Property.
2. Purchase Capital Gains Bonds under Section 54EC.
3. Investing in Capital Gains Accounts Scheme.
4. Purchase Capital Gains Bonds under Section 54EC.

How can I avoid capital gains tax in India?

Do you pay tax on Long Term Capital gains in India?

The rate of tax on the capital gains is lower, if the holding period of the property is considered as long term, while the rate is higher for a property held for a short term. Under the revised rules in India, if a property is sold after two years from its acquisition, it would attract long-term capital gains (LTCG) tax.

Is the sale of a property a long term capital gain?

The capital gains accrued through the sale of any real estate asset is deemed as capital gain on a property. If such a property is held by the individuals for over 24 months, the proceeds earned through its sale would be treated as a long-term capital gain on property.

What kind of tax is on sale of property in India?

Under the revised rules in India, if a property is sold after two years from its acquisition, it would attract long-term capital gains (LTCG) tax. A property sold before that period would attract short-term capital gains (STCG) tax.

Do you pay LTCG on capital gains on property?

Capital gains from property are eligible for tax exemptions under Sections 54, 54B and 54EC. The imposition of 20% LTCG tax rate on property can lead assesses to incur a significant amount on tax liabilities.