New Capital Gains Rules for FY 2024-25: A Must-Read Before Filing ITR 2025

Did you miss India’s July 23rd tax rule change? You might be overpaying capital gains on your ITR 2025!

Thank you for reading this post, don't forget to subscribe!

If you’ve sold a house, shares, gold, or other capital assets recently, especially during the Financial Year 2024–25, pay close attention. A major shift in India’s capital gains tax structure, introduced by the Finance (No. 2) Bill, 2024, means your tax bill now hinges not just on what you sold or how long you held it, but when you sold it. And that key date is July 23, 2024.

What’s Changed?

For property, shares, gold, and other capital assets, capital gains tax rates and benefits like indexation (adjusting for inflation) now vary based on your sale date:

• Sold before July 23rd? The old rules apply.
• Sold on or after July 23rd? The new regime takes over.

Here’s a Snapshot of Key Changes:

• Real Estate (Property):
  • Old Rule (Sold before July 23): Long-term capital gains (LTCG) on property held for 2 years or more were taxed at 20% with indexation.
  • New Rule (Sold on or after July 23): It’s a flat 12.5% without indexation.
  • Big Plus for Resident Individuals & HUFs: If you bought the property before July 23rd but sold it after, you get to choose the more favorable option between the old 20% (with indexation) or the new 12.5% (no indexation).
• Shares (Listed Equities):
  • Old Rule (Sold before July 23): LTCG (held for over 1 year) was 10% after a ₹1 lakh exemption. Short-term gains (STCG) were 15%.
  • New Rule (Sold on or after July 23): LTCG rises to 12.5%, though the exemption slightly increases to ₹1.25 lakh. STCG jumps to 20%.
• Gold, Debt Mutual Funds, & Other Capital Assets:
  • Holding Period Reduced: The period to qualify for LTCG classification drops from 3 years to 2 years.
  • Unified Tax & No Indexation: These assets now face a unified 12.5% tax with no indexation benefit.

How to File Your ITR 2025 with Capital Gains (Assessment Year 2025–26):

The Income Tax Department’s e-Filing portal will be your guide. Here’s what you’ll need and the general steps:

• Gather Your Docs: Sale/purchase deeds, broker notes, investment statements, improvement bills (for real estate), PAN, Aadhaar, and bank details.
• Log In: Access the Income Tax e-Filing portal.
• Navigate: Go to e-File > Income Tax Returns > File Income Tax Return.
• Select: Choose Assessment Year 2025–26, “Online” mode, and “ITR-2” form (unless you have business income).
• Find Capital Gains: In the “Schedules” section, select “Capital Gains.”

Crucially, when reporting your gains:

• Split by Date: Report all sales made before July 23rd under the old tax regime.
• New Rules for Post-July 23rd Sales: Report sales made on or after July 23rd using the new rules.
• Choose Wisely for Property: For real estate sold after July 23rd but purchased earlier, carefully calculate both the 12.5% (no indexation) and 20% (with indexation) options and choose the one that results in lower tax for resident individuals and HUFs.

Finally, include all your other income, deductions, and taxes. Preview, validate, and submit your return. Remember to verify it within 30 days (via Aadhaar OTP, net banking, or by post).

Filing Deadline: September 15, 2025.

Double-checking your sale dates and the applicable rates is paramount. A single wrong entry could cost you thousands in extra tax! Don’t get caught off guard.