Capital Gains Tax Calculator
Calculate LTCG and STCG tax on equity, mutual funds, real estate, and gold as per Indian tax rules.
About the Capital Gains Tax Calculator
Capital gains tax is one of the most impactful yet misunderstood taxes for Indian investors. Budget 2024 brought the most sweeping changes in a decade: equity short-term capital gains (STCG) jumped from 15% to 20%, long-term capital gains (LTCG) rose from 10% to 12.5%, and the exemption limit was raised from ₹1 lakh to ₹1.25 lakh per financial year. For real estate sold after July 23, 2024, indexation benefit was removed - meaning you pay 12.5% on the full nominal gain rather than the inflation-adjusted gain.
The difference between STCG and LTCG can be dramatic on large trades. A ₹5 lakh profit from equity held for 11 months costs ₹1,00,000 in STCG tax at 20%. The same profit held for 13 months costs just ₹46,875 in LTCG tax (12.5% on ₹3.75L after ₹1.25L exemption). That extra 2 months saves ₹53,125 - more than a month of salary for most earners. The calculator accounts for this precisely, including the ₹1.25L annual exemption for equity LTCG.
Different asset classes have different holding period thresholds. Equity and equity mutual funds qualify for LTCG after just 12 months. Real estate, gold, and debt funds require 24 months. Debt mutual funds lost their LTCG advantage after April 2023 and are now fully taxed at your income slab rate regardless of holding period - making them less attractive for investors in the 30% bracket compared to PPF or tax-free bonds.
Capital Gains Tax (Post Budget 2024)
Tax = max(0, Gains - Exemption) x Rate / 100 + Surcharge + Cess (4%)
Equity STCG (held 12 months): 12.5% on gains above ₹1.25L per FY · Real estate / gold LTCG (held >24 months): 12.5% no indexation · Debt MF: taxed at applicable income slab rate regardless of holding period · Surcharge: 10% on tax if gains exceed ₹50L
Worked Example
Sold equity mutual fund: bought ₹5L, sold for ₹9L after 2 years
LTCG = ₹4,00,000 · Exempt: ₹1,25,000 · Taxable gain = ₹2,75,000 · Tax = 12.5% x ₹2,75,000 = ₹34,375 · Add 4% cess = ₹35,750 total
Tips & Insights
- 1
Use the ₹1.25L LTCG exemption every financial year by booking equity profits and immediately reinvesting - this 'tax harvesting' resets your cost basis legally.
- 2
Tax-loss harvesting: sell loss-making investments before March 31 to offset gains from profitable ones and reduce your taxable gains for the year.
- 3
Debt mutual fund gains are now taxed at your income slab rate regardless of holding period. For 30% bracket investors, PPF, tax-free bonds, and arbitrage funds are better alternatives.
- 4
Equity LTCG has no indexation benefit - the clock simply starts when you buy. The only way to reduce tax is to stay invested over 12 months and use the annual exemption.
- 5
Capital losses can be carried forward for 8 years. STCL can offset both STCG and LTCG; LTCL can only offset LTCG. File your ITR on time to preserve this carryforward right.
- 6
For real estate bought before July 2024, you may still be able to claim the old indexation benefit (20% with indexation) if it results in lower tax - consult a chartered accountant.
- 7
If your total equity LTCG is under ₹1.25L this year, there is zero tax payable - no need to declare or pay advance tax on that amount.
- 8
Gifting appreciated assets to a spouse does not eliminate capital gains tax - the original cost basis is used when the spouse eventually sells, and clubbing provisions may apply.
Why this matters for you
The 2024 Budget changes made the difference between short-term and long-term holding periods even more costly to ignore. At the old 15% STCG rate, the tax penalty for selling 2 months early was manageable. At 20%, selling equity 11 months in versus 13 months in can cost an additional 7.5% of your gains in extra tax - a meaningful drag on compounded returns over a lifetime of investing.
Capital gains planning is one of the few areas where individual investors have genuine control over their tax liability. Unlike salary income, you choose when to sell. Spreading large sales across two financial years to use the ₹1.25L exemption twice, booking losses before year-end, and avoiding debt MFs in favour of more tax-efficient instruments are all strategies this calculator helps you quantify before you act.
India's growing retail investor base - over 9 crore demat accounts - means millions of people are making capital gains decisions without fully understanding the tax implications. A ₹10 lakh profit handled tax-efficiently versus carelessly can differ by ₹1-2 lakh in tax paid. This calculator gives you the numbers upfront so you can decide when to hold, when to book, and when the tax savings justify waiting a few more months.
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Frequently Asked Questions
What is capital gains tax in India?+
Capital gains tax applies when you sell a capital asset - stocks, mutual funds, property, gold, or bonds - at a profit. The gain (sale price minus purchase price) is added to your income and taxed at rates that depend on the asset type and how long you held it. Assets held for shorter periods qualify as short-term capital gains (STCG) and are taxed at higher rates; assets held longer qualify as long-term capital gains (LTCG) at lower, more favourable rates. Budget 2024 revised both rates and exemption limits significantly.
What are the LTCG and STCG rates for equity after Budget 2024?+
Post Budget 2024 (effective FY 2024-25): Equity STCG for shares or equity mutual funds held 12 months or less is taxed at 20%. Equity LTCG for shares or equity mutual funds held more than 12 months is taxed at 12.5%, but only on gains exceeding ₹1.25 lakh per financial year - gains up to ₹1.25L are fully tax-free. Before Budget 2024, STCG was 15% and LTCG was 10% with a ₹1L exemption. The increase in both rates makes holding duration planning even more critical.
What are the capital gains rules for real estate?+
Real estate sold after July 23, 2024 is subject to 12.5% LTCG without indexation if held for more than 24 months. For properties bought before July 23, 2024, taxpayers may compare the old method (20% with indexation) and the new method (12.5% without indexation) and pay whichever results in lower tax - consult a chartered accountant to verify eligibility. Short-term capital gains on property held 24 months or less are added to total income and taxed at the applicable slab rate, which can be as high as 30%.
What is the ₹1.25 lakh LTCG exemption and how does it work?+
For equity shares and equity-oriented mutual funds, the first ₹1.25 lakh of net long-term capital gains in any financial year (April to March) is completely exempt from tax. This was raised from ₹1 lakh in Budget 2024. The exemption applies per individual per year - so a couple can collectively exempt ₹2.5 lakh. Smart investors use this by booking profits every year just below the ₹1.25L limit and immediately reinvesting (tax harvesting), which resets the cost basis and reduces future taxable gains over time.
How can I legally reduce capital gains tax in India?+
Legal tax planning strategies: Section 54EC bonds - invest LTCG from property sale in NHAI or REC bonds (maximum Rs. 50 lakh) within 6 months to get full exemption; these bonds lock money for 5 years at 5% interest. Section 54F exemption - reinvest LTCG from any long-term asset into a new residential house within 2 years to get full or proportional exemption. Annual LTCG exemption for equity - plan redemptions to stay under ₹1.25L per financial year. Loss harvesting - sell loss-making investments before March 31 to offset gains. Hold equity 12+ months and property or gold 24+ months to qualify for lower LTCG rates instead of slab-rate STCG.
Can capital losses be set off against other income or carried forward?+
Capital losses have specific set-off rules. Short-term capital losses (STCL) can be set off against both short-term and long-term capital gains. Long-term capital losses (LTCL) can only be set off against long-term capital gains - not against STCG or other income. Any unabsorbed capital loss can be carried forward for up to 8 assessment years to offset future capital gains of the appropriate type. Critically, you must file your Income Tax Return (ITR) on time to preserve the carryforward right - if you miss the filing deadline, the loss lapses and cannot be carried forward.
How is gold capital gains tax calculated in India?+
Physical gold (jewellery, coins, bars) held for more than 24 months qualifies as long-term and is taxed at 12.5% on gains without indexation (post July 23, 2024 Budget rule). Held for 24 months or less, gains are added to total income and taxed at the applicable slab rate. Digital gold and gold ETFs follow the same holding period and tax rate as physical gold. Sovereign Gold Bonds (SGBs) are an exception: capital gains on SGBs redeemed on maturity (8 years) are completely exempt from tax - this is a significant advantage over physical gold and gold ETFs. SGB interest income (2.5% per annum) is taxable as other income. For gold mutual funds (fund of funds investing in gold ETFs), the holding period for long-term is 24 months, and LTCG is 12.5% without indexation. The tax treatment of gold changed under Budget 2024 - verify current rules with a tax advisor for transactions executed after July 2024.