Budget 2022

Budget 2022: Surcharge on LTCG on all assets capped at 15% to benefit unlisted stock investments

PALAK SHAH | | Updated on: Feb 01, 2022
Accountant working with US tax forms

Accountant working with US tax forms | Photo Credit: simpson33

The Budget has capped the rate of surcharge on all types of assets at 15 percent irrespective of the amount of long term capital gains (LTCG). This will help promote long term equity investments in start-ups as it brings the surcharge on unlisted securities and assets on par with listed stocks.

Currently, the LTCG surcharge on unlisted companies went up to 37 per cent, depending on various slabs. Budget announcement on Tuesday in this regard will prove positive for high net worth individual investors. LTCG and surcharge on unlisted securities and assets is based on the slab wise gains made. Gains of ₹5 crore and higher attract a total tax of up to 37 per cent. For capital gains of ₹2 crore to ₹5 crore the surcharge is 25 percent.

The beneficial rate of surcharge will also apply to an Association of Persons (AOP). Thus where shares are held for less than 12 months, they will be taxable as short term capital gains and the rate of surcharge will apply at the highest rate of up to 37 per cent depending upon the quantum of gains derived. The surcharges on assets is 10 if the income is above ₹50 lakh but up to ₹1 crore. It is 15 per cent if the income is between ₹1 crore and ₹2 crore.

Published on February 01, 2022
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