The tax implications of selling US bonds by Indian residents

I am an Indian resident and purchased Bank of America's 4.45% NYSE-listed bond under the Liberalised Remittance Scheme (LRS). When I sell them, how will they be taxed in India? -Name withheld on request

- Harshal Bhuta

As a resident of India, your worldwide income is taxable here. This includes capital gains from the transfer of overseas assets. For computing capital gains, an asset is classified as either short-term or long-term, and the gains are taxed accordingly. Finance (No. 2) Act, 2024, introduced changes to taxation of unlisted bonds. From 23 July 2024, any capital gains from their transfer are deemed short-term, regardless of the actual holding period.