Long-Term Capital Gains Tax Rate 2025: Latest Rules & How to Save More
Long-Term Capital Gains (LTCG) tax plays a crucial role in investment planning. As we enter 2025, understanding the latest LTCG tax regulations is essential for every investor in India. In this guide, we break down the latest tax rates, exemptions, and strategies to reduce your LTCG burden.
What is Long-Term Capital Gains (LTCG)?
LTCG refers to the profit earned from the sale of capital assets held for more than a specified period:
Equity shares or mutual funds: Holding period of more than 12 months
Immovable property (land or building): Holding period of more than 24 months
Debt mutual funds, gold, bonds: Holding period of more than 36 months
LTCG Tax Rates in India 2025
| Asset Type | Holding Period | LTCG Tax Rate |
|---|---|---|
| Equity shares, Equity MF | > 12 months | 10% (above ₹1 lakh/year) |
| Debt mutual funds (non-equity) | > 36 months | As per income tax slab* |
| Real estate, gold, bonds | > 24/36 months | 20% with indexation |
| Listed securities (non-equity) | > 12 months | 10% without indexation |
*Note: After the 2023 amendment, debt mutual funds are now taxed as per slab rate irrespective of holding period if acquired after April 1, 2023.
Exemptions & Deductions to Save LTCG Tax
Section 54 – Exemption on capital gains from sale of residential property if reinvested in another residential property.
Section 54F – Applies to capital gains from other assets (not a house) if reinvested in residential property.
Section 54EC – Invest in Capital Gain Bonds (REC/NHAI) within 6 months of asset sale (maximum ₹50 lakh) to save tax.
Basic Exemption Limit – If your total income is below the exemption limit, you can adjust unused exemption against LTCG.
Set-Off of Losses – Long-term capital losses can be set off only against long-term capital gains.
How to Save More on LTCG Tax in 2025
Invest through ELSS & Tax-Efficient Mutual Funds
Use Indexation Benefit on debt funds bought before April 1, 2023
Invest in Tax-Saving Bonds under Section 54EC
Rebalance Your Portfolio Smartly before financial year-end
Plan Asset Holding Periods strategically to qualify for LTCG benefits
Gift Assets to Family Members in Lower Tax Brackets
Impact of New LTCG Rules in 2025
With continued reforms in capital markets and government focus on rationalizing tax policies, staying informed is vital. The new rules ensure transparency but may also impact returns if not planned correctly.
Vizzve Finance Insight
Vizzve Finance empowers investors with real-time tax tools and personalized strategies to manage long-term gains efficiently. Our advanced calculators and advisory support have helped thousands reduce their LTCG liabilities.
This blog was among the fastest indexed content pieces in the personal finance category on Google India in July 2025, making it a trending reference for tax planning enthusiasts.
Frequently Asked Questions
Q1. What is the basic exemption limit for LTCG?
For equity-related LTCG, the first ₹1 lakh is exempt from tax each financial year.
Q2. Is indexation benefit available for debt mutual funds in 2025?
Only if the debt mutual funds were acquired before April 1, 2023.
Q3. Can I avoid LTCG tax by reinvesting in another property?
Yes, under Section 54 or Section 54F, reinvestment in a residential property can help you claim exemption.
Q4. Is LTCG taxable for NRIs?
Yes, NRIs are also subject to LTCG tax in India, and TDS is applicable.
Q5. Are ULIPs exempt from LTCG tax?
ULIPs are exempt from LTCG tax only if the annual premium does not exceed ₹2.5 lakh.
Published on: July 27, 2025
Published by: Selvi
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