As a financial-planner-gurgaon/" target="_blank" rel="nofollow">financial planner, I often say, “In India, wealth is not built by earning more — it is built by keeping more.”
And nothing determines how much you keep more than taxation.
Recently, while reviewing the updated post-Budget 2024 capital gains table published in Mint, I paused.
Not because the numbers were surprising — I track these changes every year — but because of how sharply they reveal a truth most investors overlook:
Choosing the right asset is only half the journey.
Choosing the right tax treatment is the other half.
This article is my attempt to break down these new tax rules in a simple, human, Indian way — using stories from real conversations I have with clients in Gurugram, Bengaluru and Mumbai — so that you can make smarter, calmer, and more confident investment decisions.
Let’s dive deeper.
📌 The Big Shift: Taxation Is Now a Deciding Factor in Portfolio Construction
When I coach professionals inside The Richness Academy, one phrase often comes up:
“Taresh, I invested because someone said it’s good.
Not because I knew whether it is good for me.”
Taxation is one of the biggest reasons why an investment that looks great on paper may actually be eating away your returns silently.
After Budget 2024:
• Equity remains the most tax-efficient long-term asset.
• Debt mutual funds lost their indexation advantage.
• Real estate underwent its biggest tax overhaul in years.
• Gold and international assets are taxed more like ‘luxury diversifiers’ now.
Let’s break this down category by category.
🟦 1. Equity Mutual Funds, ETFs & Stocks
“The Long-Term Winner That Still Wins”
When I sit with senior executives and entrepreneurs in my sessions, many tell me:
“Taresh, equity feels risky… but I know it makes wealth.”
They are right. And Budget 2024 continues to reward long-term equity investing.
✔ Holding period for LTCG
More than 12 months
✔ Tax rates
• STCG (Short-Term): 20%
• LTCG (Long-Term): 12.5%
Yes, equity long-term capital gains are still among the lowest in India.
Even after these revisions, for wealth creation beyond 10 years, no other asset class beats equity on post-tax returns.
💬 Anecdote
One of my long-term clients, a senior leader in a tech company, once told me after reviewing his 15-year SIP dashboard:
“Taresh, if there is one thing I want my children to learn — it is the power of staying invested in equity.”
Budget 2024 continues to support this philosophy.
🟨 2. Gold ETFs & Physical Gold
“Emotional Purchase Meets Tax Reality”
Gold in India is more emotion than investment.
But the tax rules remind us that emotion has a cost.
✔ Holding period for LTCG
More than 12 months (for Gold ETFs)
More than 24 months for Gold MFs / physical gold / overseas FoFs
✔ Tax rates
• STCG → Slab rate
• LTCG → 12.5%
This is where many investors get confused.
Your 24-carat coin, your family jewellery, your digital gold — they do not enjoy the same advantages as equity or even the earlier tax rules on gold.
💬 Anecdote
A young married couple from Gurugram once came to me with this belief:
“Sir, we buy gold every Diwali because it grows tax-free.”
I smiled and explained:
“No asset is tax-free. Not even love for gold.”
Understanding this saves people lakhs in mistakes.
🟧 3. REITs & InvITs
“The new middle-class income asset with equity-like taxation”
Indian investors discovered REITs and InvITs only recently — and Budget 2024 gives clarity.
✔ Holding period for LTCG
More than 12 months
✔ Tax
• STCG: 20%
• LTCG: 12.5%
This brings their taxation close to equity, making them attractive for generating post-tax passive income.
I often tell investors:
“If you want the flavour of real estate without the headache of tenants, REITs are your bridge.”
🟥 4. Listed Bonds
“Simple, stable — but taxed like salary”
Long-term capital gains apply only after 12 months.
✔ Tax
• STCG → Slab rate
• LTCG → 12.5%
Still better than interest taxation, but not as attractive as equity.
💬 Anecdote
One retired gentleman from Delhi once asked me:
“Beta, these bonds give me peace. But why is the tax so high?”
Because most bonds are treated as income, not wealth.
Tax rules reflect that mindset.
🟫 5. Debt Mutual Funds
“The biggest shock of the decade”
This is where most investors still haven’t fully understood the change.
Debt funds bought after 1 April 2023 no longer get indexation.
They are taxed entirely at slab rate, irrespective of how long you hold them.
✔ LTCG benefit? Gone.
✔ 20% with indexation? Gone.
✔ Taxation
• Bought before 1 April 2023 → LTCG (>24 months): 12.5%
• Bought after 1 April 2023 → Slab rate, irrespective of holding period
Debt MFs are still excellent for asset allocation — but not for tax planning.
🟩 6. Foreign Equity / International ETFs
“Global diversification, Indian taxation”
✔ Holding period
More than 24 months for LTCG
✔ Tax
• STCG → Slab rate
• LTCG → 12.5%
With global investing becoming easier, many professionals are investing abroad.
But they forget that taxation is not the same as Indian equity.
This is why many investors get shocked when their foreign ETF gains are taxed at slab rates for short-term.
🟦 7. Real Estate
“The biggest tax reform in Budget 2024”
Real estate taxation has changed in a transformative way.
✔ For property bought after 23 July 2024
• LTCG: 12.5%
• No indexation benefit
✔ For property bought before 23 July 2024
Lower of:
• 12.5% without indexation
• 20% with indexation
This is a major mindset shift.
💬 Anecdote
A business owner from Pune told me:
“Taresh, earlier we bought property for indexation. Now what do we do?”
I replied:
“Now you buy real estate for the right reasons — not for tax drama.”
Real estate must be bought for:
✔ utility
✔ lifestyle
✔ rental income
✔ appreciation potential
Not simply for tax advantage anymore.
🌐 The Hidden Insight:
“Your time horizon decides your tax efficiency.”
Let me share a truth from my planning experience:
People lose more money by mismatching their goals with asset taxation than by bad funds.
Example:
• Using gold for a short-term goal
• Using debt MFs after 2023 for long-term
• Using foreign ETFs without knowing tax slabs
• Using real estate purely for indexation
If your time horizon and holding period are not aligned with tax rules, your returns silently erode.
🧠 Behaviours I See Every Day
1️⃣ “Tax is something my CA will handle.”
Wrong. Taxation is embedded inside the investment itself.
2️⃣ “Equity is risky, but debt is safe.”
Debt may be “safe,” but its post-tax return is often lower than inflation.
3️⃣ “Gold is always safe.”
Gold is volatile. And taxable.
4️⃣ “Property is the best investment.”
Not when the tax advantage disappears.
💡 My Professional Advice: Build a System, Not a Collection
Most investors in India have a box full of investments, not a system of wealth creation.
A well-designed financial plan ensures:
• You use equity where equity is most efficient
• You use debt where stability is essential
• You use gold only for diversification
• You use international assets for currency balance
• You use real estate for purpose, not pressure
When everything sits in its rightful place, taxation becomes your ally — not your enemy.
📝 Summary Table (Post-Budget 2024)
Asset LTCG Holding Period STCG LTCG
Equity MFs, ETFs, Stocks >12 months 20% 12.5%
Gold ETFs >12 months Slab rate 12.5%
Gold MFs, Physical Gold, Overseas Gold >24 months Slab rate 12.5%
REITs/InvITs >12 months 20% 12.5%
Listed Bonds >12 months Slab rate 12.5%
Debt MFs (post 1 Apr 2023) NA Slab Slab
International Equity >24 months Slab 12.5%
Real Estate >24 months Slab 12.5% (post 23 Jul 2024)
❤️ Final Thought:
“Money grows through clarity.
Taxation gives clarity to your investment choices.”
The new rules are not good or bad.
They are simply signals telling us how India wants us to invest going forward.
If you understand these signals, you will create wealth steadily — without panic, without confusion.
If you want to understand how to apply these tax rules to your goals, your income slab, and your risk profile, then take the next step.
👉 Comment “MASTERCLASS”
I will share access to my upcoming session where I teach Indian families how to create a tax-efficient, goal-aligned, automated wealth system.
Disclaimer: The views expressed are for educational purposes only and do not constitute financial, investment, tax, or legal advice. Please consult qualified professionals before making decisions. Mutual fund investments are subject to market risks.
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The author of this article, Taresh Bhatia, is a Certified Financial Planner® and advocate for female empowerment. For more information and personalized financial guidance, please contact taresh@tareshbhatia.com
He has authored an Amazon best seller-“The Richness Principles”. He is the Coach and founder of The Richness Academy, an online coaching courses forum. This article serves educational purposes only and does not constitute financial advice. Consultation with a qualified financial professional is recommended before making any investment decisions. An educational purpose article only and not any advice whatsoever.
©️2025: All Rights Reserved. Taresh Bhatia. Certified Financial Planner®
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