How does Brickplot use Capital Gains Tax on Property in its scoring?

Brickplot's 11-axis score evaluates every project against legal, financial, technical, RERA, and process dimensions — including capital gains tax on property. You can see a project's breakdown on any Brickplot review page.

Financial

Capital Gains Tax on Property

Q: Why does Capital Gains Tax on Property matter when buying property in India?

Capital Gains Tax on Property is a financial concept that affects your property purchase decision. Tax on profit from property sale. Short-term (held under 24 months): taxed at income slab rate. Long-term (held 24+ months): 12.5% without indexation or 20% with indexation (for pre-July 2024 purchases). Brickplot checks this as part of the independent 11-axis review process.

Tax on profit from property sale. Short-term (held under 24 months): taxed at income slab rate. Long-term (held 24+ months): 12.5% without indexation or 20% with indexation (for pre-July 2024 purchases).

What is Capital Gains Tax on Property?

Capital Gains Tax (CGT) is the income tax levied on the profit (capital gain) you earn when you sell a property for more than its purchase cost. In India, property is classified as a capital asset, and gains from its sale are taxed under the Income Tax Act, 1961. The tax rate and computation method depend on the holding period — how long you owned the property before selling.

Short-Term vs Long-Term Capital Gains

The dividing line is 24 months of ownership:

Short-Term Capital Gain (STCG): Property sold within 24 months of purchase. Gain is added to your total income and taxed at your applicable income slab rate (5%, 20%, or 30% depending on income level).
Long-Term Capital Gain (LTCG): Property sold after 24 months. Tax rate and computation changed with the Union Budget 2024 (effective July 23, 2024).

Post-Budget 2024 LTCG Rules

For properties purchased or sold after July 23, 2024:

LTCG rate: 12.5% without indexation (indexation adjusts cost for inflation using Cost Inflation Index)

For properties purchased before July 23, 2024 and sold after that date:

Buyer has the option to choose: 12.5% without indexation OR 20% with indexation — whichever results in lower tax

Additionally, 4% Health and Education Cess applies on the computed tax amount.

Exemptions

Section 54: LTCG from selling one residential property is exempt if the gain is reinvested in purchasing another residential property within 2 years (or constructing within 3 years)
Section 54EC: LTCG up to Rs 50 lakh is exempt if invested in notified bonds (NHAI, REC) within 6 months of sale
Section 54F: Full exemption if entire sale proceeds (not just gain) are reinvested in a new residential property

Calculation Example

Property purchased in 2019 for Rs 60 lakh (including stamp duty and registration), sold in 2026 for Rs 1.10 crore:

Cost of acquisition: Rs 60 lakh
Sale price: Rs 1.10 crore
LTCG (without indexation): Rs 50 lakh
Tax at 12.5%: Rs 6.25 lakh + 4% cess = Rs 6.5 lakh

How Brickplot Uses This

Brickplot investment yield projections include estimated post-tax returns by calculating indicative CGT for buyers who hold for 5 or 10 years and sell, helping buyers compare real returns across projects.

Related Terms

TDS on Property — buyer deducts TDS from the seller covering part of the CGT liability
Section 80C Home Loan — tax benefit on purchase side

Brickplot verifies capital gains tax on property disclosures on every reviewed project as part of the independent 11-axis score. No builder commissions. No editorial override.

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