LTCG: Make The Most Out Of Long Term Capital Gains
Hello!
I am so glad to be writing to y’all again!!
Niyati & I keep nudging you towards being/becoming a long-term investor at every change we get. But what happens after that… when it’s time to reap benefits? That’s exactly what I wanna bring to you in this edition, so keep reading!
What I was up to: This week’s been a great week for all of us at Fincocktail and I’m super excited to let you know that the Personal Finance Course that we’ve put our hearts & souls into for the longest time is FINALLY here! Whoever said “The harder the battle, the sweeter the victory” has simply articulated it perfectly and I know it first-hand now. To see something that’s been in the pipeline for so long be well-received and appreciated is just priceless, head right over and check it out here!
Market ka haal: As predicted by experts, the Indian stock markets have been fairly bullish post the announcement of election results, and key indices ended higher for the third consecutive session yesterday, with Sensex and Nifty closing at 76,810.9 and 23,398.9, respectively.
Elsewhere, the markets in Asia, Europe, and the US have mostly been on the rise, particularly after the US government reported that inflation pressures eased in May. The Fed has held its main interest rate at its highest level in over two decades, and Wall Street is now hoping for one or two cuts to that rate this year.
Monsoon is setting in, which means fresh produce price hikes are right around the corner, but realistically speaking, they are already here. So it's not the best time to lend some dhaniya patta (coriander leaves) to your friendly next-door neighbor, LOL! Watch out! 👀
Also, we now have our very own WhatsApp channel to serve freshly cooked finance content directly to your DMs and get you to be amazing at managing your money 💰 Click here to join!
Humara Gyaan: How annoying is it when you gotta pay taxes when you’re finally reaping the sweet fruits of success? Wait, don’t answer that, I know it’s awful, too. It’s a penalty for your victory after all, but it doesn't have to be painful. So, consider these 3 quick tips to say “gotcha” to the government:
📉 Utilize Tax Exemptions and Indexation Benefits
Maximize Exemptions: Gains from equity shares and mutual funds up to INR 1 lakh are tax-free. Plan your sales to stay within this limit.
Use Indexation: For assets like real estate, indexation adjusts the purchase price for inflation, reducing your taxable gain and saving you money.
💼 Invest in Tax-Saving Bonds
Section 54EC: Invest in NHAI or REC bonds within six months of selling your asset to defer taxes and secure fixed returns. You can invest up to INR 50 lakh.
🏡 Reinvest in Residential Property
Section 54: Reinvest gains from selling a residential property into another one within the specified period.
Section 54F: Sell any long-term asset and buy residential property within one year before or two years after the sale, or construct a new house within three years to save on taxes.
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It's of course a bummer that avoiding taxes entirely isn't possible, but our noice and smort strageties can easen the blow for sure, helping you avoid paying more than what's necessary. Indeed, "It's not what you earn, but what you keep that determines your wealth." 💰
To making and keeping the most,🍻
Sayali❤️
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