I bought my flat in 2018 - how much tax if I sell now?

A resident individual/HUF who bought before 23 July 2024 can choose the cheaper of two methods on sale: 12.5% on the plain gain, or 20% on the inflation-adjusted gain. Pay whichever is lower. Only for resident individuals/HUF, and only property acquired before 23 July 2024 Compute both ways - 12.5% no indexation, 20% with indexation - and pay the lower This LTCG generally doesn't qualify for the Section 87A nil-tax-up-to-12-lakh rebate Whether this choice continues for sales after 1 April 2026 under the new Act is NOT yet confirmed

Do I choose between 12.5% and 20% tax?

A resident individual/HUF who bought before 23 July 2024 can choose the cheaper of two methods on sale: 12.5% on the plain gain, or 20% on the inflation-adjusted gain. Pay whichever is lower. Only for resident individuals/HUF, and only property acquired before 23 July 2024 Compute both ways - 12.5% no indexation, 20% with indexation - and pay the lower This LTCG generally doesn't qualify for the Section 87A nil-tax-up-to-12-lakh rebate Whether this choice continues for sales after 1 April 2026 under the new Act is NOT yet confirmed

CAPGAIN › Answers › Capital gains & TDS on property › How Is Tax Calculated on Property I Bought Before July 2024?

How Is Tax Calculated on Property I Bought Before July 2024?

Short answer: A resident individual/HUF who bought before 23 July 2024 can choose the cheaper of two methods on sale: 12.5% on the plain gain, or 20% on the inflation-adjusted gain. Pay whichever is lower.

Law: Section 112(1), second proviso, Income-tax Act 1961 · Authority: CBDT · Status: in force (effective 23 Jul 2024) · Checked 25 Sept 2026

What you need to know

Only for resident individuals/HUF, and only property acquired before 23 July 2024
Compute both ways - 12.5% no indexation, 20% with indexation - and pay the lower
This LTCG generally doesn't qualify for the Section 87A nil-tax-up-to-12-lakh rebate
Whether this choice continues for sales after 1 April 2026 under the new Act is NOT yet confirmed

Who this applies to: sellers (resident individuals/HUF), CAs

Official / primary source: pib.gov.in (government source)

The law behind it

Capital Gains Tax on Sale of REIT/InvIT Units - Section 112A

If you sell listed REIT or InvIT units on the stock exchange after holding them more than 12 months, the gain is taxed as long-term capital gains at 12.5%, with the first Rs 1.25 lakh of such gains in a year tax-free. Selling within 12 months attracts a higher 20% short-term rate.

Section 112A and Section 111A, Income-tax Act 1961 (rates as amended by Finance Act (No. 2) 2024) · in force · source

24-Month Holding Period for Long-Term Capital Asset Status (Property)

Hold a property over 24 months before selling and your gain is 'long-term', with better tax treatment. This has applied since AY2018-19 and was NOT changed by the July 2024 budget reforms.

Section 2(42A), Income-tax Act 1961 / Section 2, Income-tax Act 2025 · in force · source

Section 393(1), Income-tax Act 2025 - Consolidated TDS on Property/Rent/Contractors

The new Act merges old Sections 194-IA, 194-IB, 194-I plus contractor/professional TDS into one Section 393(1), reported on one Form 141. The 1% rate and Rs 50 lakh threshold for property from a resident are unchanged - only the paperwork changed.

Section 393(1), Income-tax Act 2025 · in force · source

Section 26, Income-tax Act 2025 - House Property Deductions (successor to Section 24)

The 30% standard deduction and home loan interest rules from Section 24 continue as Section 26 of the new Act.

Section 26, Income-tax Act 2025 · in force · source

Work out your own numbers

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