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Indexation Benefit available or not on Calculation of Total Income for Rebate purpose for Individual

Tax planning 745 views 3 replies

Pratik

Student

33 Points Posted on 04 March 2026

For FY 2025-26, I had transferred Land for which both options were available to me that is opting for indexation benefit and pay Capital Gain Tax @ 20% or Opting out of indexation and paying tax @ 12.50 %,

Opting for Indexation Benefit would be beneficial option for me.

For Calculating my Total Income and Income for Rebate purpose for FY 2025-26, My Total Income i.e (income from PGBP + Income from Capital Gain) Thus Indexation Benefit would be available to me on my capital gain income for calculating total income and rebate.

Replies (3)

Quick Summary

For FY 2025-26, indexation can be used to reduce LTCG and compute total income. However, Section 87A rebate is not allowed on tax payable on such capital gains, irrespective of regime choice.

Aashok F C Advisory

Finance & Compliance Consultant | FP

362 Points Posted on 04 March 2026

For FY 2025-26, you can use indexation to reduce the taxable amount of your Capital Gain when calculating Total Income. However, you cannot claim the Section 87A rebate against the tax due on those Capital Gains, as the rebate is now restricted to income taxed at normal slab rates.