Until financial year 2017-18, Long Term Capital Gain (LTCG) tax on equity or equity oriented mutual funds was Nil, i.e. if investors sold their shares or equity oriented mutual fund units after holding them for more than a year, they paid zero LTCG tax. All the gains (no matter the amount) were theirs to keep without fear of the taxman.
However, in this year’s budget, the government has changed the rules and has introduced an LTCG tax of 10% (without indexation) on gains made above ₹1,00,000 per annum, starting from April 1st 2018.
To understand the implication of this new LTCG tax, you need to understand some key points and features: Read More