New Income Tax Bill 2025: NRIs to Benefit from Forex Fluctuation on LTCG from These Equity Shares

New Income Tax Bill 2025: NRIs to Benefit from Forex Fluctuation on LTCG from These Equity Shares

The New Income Tax Bill, 2025, has a rule that helps non-resident Indians (except FIIs) pay lower tax on capital gains from selling unlisted equity shares of an Indian company. This rule is called the ‘forex fluctuation benefit‘. It allows NRIs to reduce their long-term capital gains tax by adjusting for changes in foreign exchange rates.

As per calculations, if this rule in the New Tax Bill, 2025, is incorporated in the final act, NRIs could end up paying up to 72% less LTCG tax compared to before. This is because, under the old tax act of 1961, NRIs had to pay higher taxes because the Indian Rupee (INR) was losing value over time due to depreciation. Now, under the new rule, NRIs are only required to pay tax on real profit in USD.