The government has proposed significant changes to capital gains tax (CGT) in the Finance Act 2024, impacting both immovable property and securities. Here’s a breakdown of the key proposals:
Immovable Property (Land & Buildings):
- Flat Rate of 15%: A simplified system proposes a flat 15% tax rate on capital gains from immovable property acquired on or after July 1, 2024, for individuals listed on the Active Taxpayers List (ATL) at the time of disposal. Holding period will no longer be a factor.
- No Change for Existing Properties: Properties acquired before July 1, 2024, will continue to be taxed under the existing regime, with varying rates based on holding period and property type.
| Holding Period (Year) | Open Plots | Constructed Property | Flats |
| ≤ 1 | 15% | 15% | 15% |
| 1 – 2 | 12.50% | 10% | 7.50% |
| 2 – 3 | 10% | 7.50% | 0 |
| 3 – 4 | 7.50% | 5% | – |
| 4 – 5 | 5% | 0 | – |
| 5 – 6 | 2.50% | – | – |
| 6+ | 0% | – | – |
Securities (Stocks & Shares):
- Where the securities are acquired before the first day of July, 2013 It will be exempt.
- Where the securities are acquired on or after the first day of July, 2013 but on or before the 30th day of June, 2022 12.5% for Filers and .
- Where the securities are acquired on or after the first day of July, 2024 and onwards Filers Ind/AOPs/Company 15% & Non Filers Business Slab rates apply, but not less than 15%. Companies not appearing on ATL will be charged. at 29% unless small company.
- Where the securities are acquired on or after the first day of July, 2022 but on or before the 30th day of June, 2024, below reduced rates of tax on capital gain arising on disposal shall apply:
| Status | Tax Rates |
| Holding Period | Reduced Tax Rate (%) |
| Where the holding period does not exceed one year | 15 |
| Not exceed two years | 12.5 |
| Where the holding period exceeds two years but does not exceed three years | 10 |
| Where the holding period exceeds three years but does not exceed four years | 7.5 |
| Where the holding period exceeds four years but does not exceed five years | 5 |
| Where the holding period exceeds five years but does not exceed six years | 2.5 |
| Where the holding period exceeds six years | 0 |
Pre-2013 Acquisitions Exempt: Securities acquired before July 1, 2013, remain exempt from capital gains tax.
What You Need to Do:
- Stay Informed: Investors are advised to closely monitor the finalization of these proposals and seek professional advice to understand the potential impact on their investment strategies.
- Review Acquisitions: Identify the acquisition dates of your immovable property and securities to determine which tax regime applies.
- ATL Status: If you’re not already on the ATL, consider registering for potential tax benefits on future capital gains from securities.
