What changed with Budget 2024
Before 23 July 2024, LTCG on immovable property was uniformly taxed at 20% with indexation. The Finance (No. 2) Act 2024 changed this:
- Property acquired before 23 July 2024: taxpayer gets a CHOICE between 12.5% without indexation OR 20% with indexation — whichever is lower. This transitional regime is permanent for these properties.
- Property acquired on or after 23 July 2024: only 12.5% without indexation. No indexation option.
- For all OTHER long-term assets (equity, gold, debt funds, unlisted shares), indexation is permanently removed; LTCG is flat 12.5%.
- The 24-month holding-period threshold for LTCG on immovable property is unchanged. Less than 24 months = short-term capital gain (STCG), taxed at your slab rate.
Which method wins for which property?
Old properties (purchased before 2015): 20% with indexation almost always wins. The CII has nearly quadrupled since FY 2001-02 (100 → 376 in FY 2025-26). Indexation can wipe out 60-80% of the headline gain.
Properties bought 2015-2024: Result depends on the rate of appreciation. If your property's appreciation rate is roughly equal to inflation, the two methods produce similar tax. If appreciation outpaces inflation (typical in metros), 12.5% without indexation can win on lower gains.
Recent (post 23 July 2024): Method choice doesn't exist. 12.5% no indexation is the only option.
CII table — base year FY 2001-02 = 100
The Cost Inflation Index is notified annually by CBDT. For sales in FY 2025-26 (Apr 2025–Mar 2026), the CII is 376. For FY 2026-27, the CII has not yet been notified (typically released in June-July each year). The historical table:
| FY | CII | FY | CII | FY | CII | FY | CII |
|---|---|---|---|---|---|---|---|
| 2001-02 | 100 | 2007-08 | 129 | 2013-14 | 220 | 2019-20 | 289 |
| 2002-03 | 105 | 2008-09 | 137 | 2014-15 | 240 | 2020-21 | 301 |
| 2003-04 | 109 | 2009-10 | 148 | 2015-16 | 254 | 2021-22 | 317 |
| 2004-05 | 113 | 2010-11 | 167 | 2016-17 | 264 | 2022-23 | 331 |
| 2005-06 | 117 | 2011-12 | 184 | 2017-18 | 272 | 2023-24 | 348 |
| 2006-07 | 122 | 2012-13 | 200 | 2018-19 | 280 | 2024-25 | 363 |
| 2025-26 | 376 | ||||||
Sections 54, 54F, 54EC — the three exemption levers
Section 54 — sell a residential house, reinvest the GAIN (not the full sale) into another residential house in India. Time limits: 1 year before or 2 years after the sale (purchase), or 3 years (construction). Up to ₹10 crore exemption per assessee per Budget 2023 cap. Up to 2 residential properties if gain ≤ ₹2 crore (one-time lifetime option).
Section 54F — sell any OTHER long-term asset (plot, commercial, shares), reinvest the entire NET SALE CONSIDERATION (not just the gain) into a residential house. Pro-rata exemption if you invest only part of the sale proceeds. Cannot own more than 1 other residential house at the time of sale. Same time limits + ₹10 crore cap.
Section 54EC — invest LTCG (up to ₹50 lakh per FY) in NHAI/REC/PFC/IRFC bonds within 6 months of sale. 5-year lock-in. Bonds pay ~5.25% annual interest. Best for moderate gains where you don't want to commit to a new property purchase.
Stackable: You can use Section 54EC bonds (₹50L) AND Section 54/54F on the same sale — they apply to different parts of the gain. So a ₹1 crore residential LTCG could go entirely tax-free: ₹50L in bonds + ₹50L invested in a new house.
What this calculator does NOT model
- Surcharge layer (10-37% additional based on total income exceeding ₹50L / ₹1Cr / ₹2Cr / ₹5Cr). Surcharge on LTCG was capped at 15% by Budget 2022 for most assets but applies above that for income from other sources. Consult a CA for the layered computation.
- Multiple improvements over the years. The calc handles one improvement entry. For multiple improvements at different dates, sum the indexed costs separately in a spreadsheet and add to the indexed cost of acquisition.
- Capital Gains Account Scheme (CGAS). If you can't immediately reinvest, park the gain in a CGAS account before ITR filing due date. The calc treats reinvestment as completed.
- Joint ownership / co-owner LTCG split. If the property is jointly owned (e.g. husband and wife), each owner's LTCG is computed separately on their share. Run the calc separately for each owner with their respective shares.
- Inherited / gifted property. For inherited property, use the original purchase price and date when the previous owner acquired it (CII of original year). The calc accepts those values but doesn't enforce the rule — be careful with date inputs.
- Pre-April-2001 property. For property purchased before 1 April 2001, you can use the higher of actual cost or FMV as on 1 April 2001. The calc starts at FY 2001-02; substitute the FMV value in the purchase-price field.
Frequently asked questions
How is LTCG calculated on property sale after Budget 2024?
From 23 July 2024 onwards, the Finance Act 2024 changed the LTCG regime for immovable property. For properties acquired before 23 July 2024 and sold thereafter, you have a CHOICE: pay 12.5% tax without indexation, OR 20% tax with indexation, whichever is lower. For properties acquired on or after 23 July 2024, only the 12.5% without indexation rate applies. The 24-month holding-period threshold for LTCG on immovable property is unchanged. Indexation uses the Cost Inflation Index notified by CBDT; for FY 2025-26 the CII is 376 (base year FY 2001-02 = 100). For older properties with high inflation between purchase and sale, the 20% with indexation option usually wins by a wide margin.
What is Section 54 exemption on LTCG from property sale?
Section 54 gives an LTCG exemption when you sell a long-term residential house and reinvest the capital gain (not the full sale value) into another residential house in India. The new house must be purchased within 1 year before or 2 years after the sale, OR constructed within 3 years. Exemption = lower of (actual LTCG) or (amount invested in new house). The new property is locked in for 3 years — selling it earlier reverses the exemption. Budget 2023 capped the maximum exemption at ₹10 crore per assessee. If you can't immediately reinvest, park the gain in a Capital Gains Account Scheme (CGAS) at any nationalised bank before ITR filing due date, and use it within the time limit.
How is Section 54F different from Section 54?
Section 54 applies when you sell a residential house and reinvest into another residential house. Section 54F applies when you sell ANY OTHER long-term capital asset (plot, commercial property, gold, shares) and reinvest into a residential house. The biggest difference: Section 54F requires reinvesting the entire NET SALE CONSIDERATION (not just the gain) for full exemption — pro-rata exemption if you invest less. Section 54 only requires reinvesting the gain. Section 54F has an additional condition: you must not own more than one residential house at the time of the original sale. Both sections have the same time limits and the same ₹10 crore Budget 2023 cap.
What is the ₹50 lakh limit under Section 54EC?
Section 54EC allows you to invest your LTCG from sale of land or building into specified bonds (NHAI, REC, PFC, IRFC — the 'capital gain bonds') and claim exemption. The investment must be made within 6 months of the sale date. The maximum exemption is capped at ₹50 lakh per financial year. Because of the 6-month window, you can theoretically split a sale across two FYs to claim ₹50L in each year, but only if the sale date and the 6-month window straddle a 31 March boundary — in practice, total exemption is capped at ₹50 lakh for most sales. Bonds have a 5-year lock-in and pay ~5.25% annual interest. Most useful when your LTCG is ₹1-50 lakh and you don't want to commit to a new property purchase.
Can I combine Section 54, 54F, and 54EC exemptions on the same sale?
Yes, exemptions are stackable when applied to different parts of the LTCG amount. For example, if you sell a residential house and have an LTCG of ₹1 crore: invest ₹50 lakh in Section 54EC bonds (full exemption under 54EC) AND use the remaining ₹50 lakh gain to purchase another residential house (full exemption under Section 54). Total exemption: ₹1 crore, tax payable: zero. However, you cannot claim the SAME amount under two sections — no double-dipping. For Section 54 vs 54F, you cannot use both for the same sale because they apply to different originating asset types (residential vs other). The combined exemption cap is ₹10 crore under each of 54 and 54F (Budget 2023) plus ₹50 lakh under 54EC.
Log yeh bhi poochte hain (Hinglish FAQs)
Budget 2024 ke baad LTCG kaise calculate hota hai property par?
23 July 2024 se Finance Act 2024 ne LTCG ka regime change kiya. Agar property 23 July 2024 se pehle khareedi thi aur ab bech rahe ho, toh aapko CHOICE milti hai: 12.5% bina indexation OR 20% with indexation — jo bhi kam tax aaye. Agar property 23 July 2024 ke baad khareedi thi, sirf 12.5% bina indexation lagega — koi choice nahi. Holding period 24 mahine se zyaada hona chahiye (warna STCG, slab rate par tax). Indexation CII se calculate hoti hai — FY 2025-26 ka CII 376 hai (base FY 2001-02 = 100). Purane properties (15+ saal pehle ki) mein 20% with indexation almost always jeetta hai kyunki inflation ne purchase price ko 3-4x kar diya hota hai notionally.
LTCG tax bachane ke kya tareeke hain?
Teen main exemption sections hain. Section 54: residential house bechi hai, gain ko doosre residential house mein invest karo (1 saal pehle ya 2 saal baad kharido, ya 3 saal mein construct karo) — entire gain exempt up to ₹10 crore. Section 54F: plot/commercial/shares bechi hai, ENTIRE sale value ko residential house mein invest karna padta hai (gain nahi — full sale proceeds), pro-rata exemption agar partial invest karte ho. Section 54EC: ₹50 lakh tak NHAI/REC/PFC/IRFC ke bonds mein invest karo within 6 months — 5 saal ka lock-in but tax pura exempt. Stackable hain — ek ₹1Cr residential LTCG par ₹50L bonds + ₹50L naya ghar = full exemption, zero tax. CGAS account mein park kar sakte ho agar ITR filing tak ready nahi ho.
Indexation ka calculation kaise hota hai?
Indexed cost of acquisition = Original purchase price × (CII of sale year ÷ CII of purchase year). Example: 2010-11 mein ₹30L mein flat khareedi (CII 167), 2025-26 mein bech rahe ho (CII 376). Indexed cost = 30L × (376/167) = ₹67.54 lakh. Agar sale price ₹95L hai, toh indexed gain = 95L − 67.54L = ₹27.46 lakh (jabki without indexation gain ₹65L hota). Tax: 20% × 27.46L = ₹5.49L vs 12.5% × 65L = ₹8.12L. Indexation wins by ₹2.6L. Improvements ka indexation alag hota hai — improvement ke saal ka CII use hota hai (purchase year ka nahi).
2001 se pehle khareedi gayi property ka kya kare?
Base year FY 2001-02 hai (CII = 100). 1 April 2001 se pehle khareedi gayi property ke liye, taxpayer ki choice hai: actual cost OR FMV (Fair Market Value) as on 1 April 2001 — jo zyaada ho. FMV nikalne ke liye: registered valuer ki valuation report ya circle rate of 2001 use kar sakte ho. Iss higher value ko "deemed cost of acquisition" mantey hain, aur CII 2001-02 = 100 maan ke indexation karte hain. Yeh option Budget 2024 ke baad bhi available hai for properties purchased before 23 July 2024. Calc mein iss value ko "Purchase price" field mein daalo aur purchase year FY 2001-02 select karo.
Husband-wife joint property bech rahe hain, kaise calculate karen?
Joint ownership mein har owner ka LTCG separately compute hota hai uske share par. Agar 50-50 joint ownership hai aur property ₹1Cr mein bechi (cost ₹40L), toh husband ka share: sale ₹50L, cost ₹20L, gain ₹30L. Wife ka share: same. Dono ko apne-apne ITR mein LTCG report karna padta hai — combined nahi. Section 54/54F exemption bhi har owner separately claim karega apne share par. Calc ko do baar run karo — pehle husband ke share ke numbers daalke, phir wife ke. Practical baat: jo joint owner ne actually paisa lagaya tha property mein, uska true share usske paid amount ke proportion mein hota hai (Income Tax Tribunal rulings); sirf naam joint hone se 50-50 nahi hota agar contribution unequal tha.