Akshay

Did you know Tax Harvesting can help you save up to ₹15,625💸 on taxes from your equity investments every year? So, what exactly is LTCG?   🔸 Long-Term Capital Gains (LTCG) are the profits you earn from selling equities (like shares and mutual funds) after holding them for more than a year. If your capital gains exceed ₹1.25 lakh in a financial year, they are considered LTCGs. 🔸 Just a heads up – the first ₹1.25 lakh of your LTCG is exempt from the 12.5% tax (earlier 10%)! Let’s dive into what Tax Harvesting is and how it works: 🔸 Tax Harvesting is a strategy that helps you make the most of the ₹1.25 Lakh annual LTCG exemption. It involves selling and buying back a portion of your investments to realize gains, ensuring that you don’t pay taxes on the exempt ₹1.25 Lakh of LTCG. You can repeat this process every financial year to fully utilize the ₹1.25 lakh LTCG exemption. 🔸 By doing this, you could save up to ₹15,625 in taxes annually! ✳️ An Example: 🔸 Let’s say you invested ₹ 10,00,000 in an Equity Mutual Fund/Stock on 16th May 2023, and by 18th June 2024, the value of your investment grew to ₹11,50,000. 🔸 If you redeem it now, your gains would be ₹1.50 lakh, which falls outside the ₹1.25 lakh exemption limit, meaning your tax liability would be on 25,000 and not on whole 1.50 lakh. This is possible because the first ₹1.25 Lakh of LTCG is exempt from the 12.5% tax. 🔸 Once you redeem, you can reinvest the full ₹11.50 lakh. This resets your investment cost to ₹11.50 lakh, allowing you to track gains from this new amount. This is possible because the first ₹1.25 Lakh of LTCG is exempt from the 12.5% tax. 🔸 Once you redeem, you can reinvest the full ₹11.50 lakh. This resets your investment cost to ₹11.50 lakh, allowing you to track gains from this new amount. There are further ways you to proceed and save your hard earned money from TAXES. EVERY FISCAL YEAR POLICY has immense impact on the middle class peopls' budget. Plan wisely to .build your wealth slowly and steadily. #LTCG, Tax, Personal Finance, ITR Filling.