Glossary · Income Tax
LTCG
Profit arising from the sale of a capital asset held beyond the holding period prescribed for that asset class.
When a capital asset is transferred after it has been held for longer than the prescribed holding period for that class of asset, the profit is a Long-Term Capital Gain (LTCG). Long-term gains are generally taxed more favourably than short-term gains, and exemptions (for example on reinvestment in specified assets) can reduce the chargeable amount. The holding period and rates in force depend on the asset type under the Income Tax Act.
Examples
Holding a residential property beyond the prescribed holding period before selling it makes the profit an LTCG.