Stocks, ETFs and mutual funds: new capital gains tax rates

When people sell investments for a profit, the government takes a share of that profit, called a capital gains tax.

India's Union Budget 2024 changed many of these tax rules to make them more similar across different investments.

For most long-term investments, like shares or mutual funds held for more than a year, the profit is taxed at 12.5%.

But the rules depend on what you invested in and how long you held it.

Stocks, exchange-traded funds and equity mutual funds are considered long-term after just 12 months and pay 20% tax on short-term profits.

Some investments, like gold, overseas mutual funds and fund-of-funds, need to be held for more than 24 months to get the lower long-term rate.

Debt mutual funds bought after April 2023 are taxed at your regular income tax rate, which may be higher.

Real estate bought after July 2024 gets the new 12.5% long-term rate after 24 months.

For older properties, taxpayers can choose whichever tax calculation is lower.

So investors must check the asset, purchase date and holding period before selling.