look news india
Tax savings on property: If you are planning to sell an old property bought in 2001 or later, you may have to pay more tax than before due to the end of indexation benefits, but you can avoid LTCG tax completely. There has been a big controversy over property tax since the budget was presented. The government has reduced the long term capital gain (LTCG) tax on property from 20% to 12.5%. On the other hand, the government has removed the indexation benefit, which was used to adjust for inflation and reduce tax on income from property. The government is in a tizzy over this matter. This increases the government's revenue, but it is a direct blow to those homeowners who have been paying interest for years. The government levies tax on everything and now it is cracking down on income as well. This income is the property created by paying interest piecemeal.
How will you not have to pay even a single rupee of LTCG tax…
The Modi government has reduced the LTCG tax on property in the budget, but the indexation benefit has been removed. In such a situation, if you want to avoid this tax, then you have to do one thing, only then you can avoid this tax. Revenue Secretary Sanjay Malhotra said that if a person uses the capital gains from selling his old house or property to invest in a new property, then he will be exempted from paying tax on any LTCG. This means that you will not have to pay a single rupee of LTCG tax.
No tax on buying new property from profits-
According to the Economic Times report in a news published on India Today, the Revenue Secretary said that when you sell the old property and buy a new property, then there is no tax on it.
What is indexation?
Indexation adjusts the purchase price of a property for inflation from time to time, which is used to calculate capital gains. The government releases the Cost Inflation Index (CII) every year to measure the change in prices compared to the base year (2001-2002). Indexation is calculated on this basis and declared.