Five asset classes, taxed five different ways, and the rules changed twice in three years. This applies the ones actually in force and shows the working line by line.
Rates as amended 23 July 2024, checked 20 August 2026
Held over 12 months, so long term. Taxed at 12.5% on gains above the ₹1,25,000 annual exemption.
| Step | Amount |
|---|---|
| Sale value | ₹8,00,000 |
| Less cost | (₹5,00,000) |
| Gain | ₹3,00,000 |
| Less annual exemption | (₹1,25,000) |
| Taxable gain | ₹1,75,000 |
| Tax at 12.5% | ₹21,875 |
| Health and education cess at 4% | ₹875 |
| Total tax | ₹22,750 |
| You keep | ₹7,77,250 |
The ₹1,25,000 exemption is annual and shared across all your equity gains, not per sale. Booking gains elsewhere in the same year reduces what is left here, which is what the field below it is for.
Reduces the ₹1.25 lakh exemption still available
Rates as amended 23 July 2024 and unchanged by the Budgets of 2025 and 2026. Income-tax Act, 2025, rates as amended 23 July 2024. Checked 20 August 2026.
The gain is the sale value less what you paid. Whether it is long term depends on the asset and the holding period: twelve months for listed equity, twenty-four for property, gold and unlisted shares, and never for a debt fund bought on or after 1 April 2023.
The rate then follows the classification. Long-term equity is 12.5% on gains above the ₹1,25,000 annual exemption; short-term equity is 20% with no exemption. Property long term is 12.5% without indexation, or 20% on the indexed gain where the asset was acquired before 23 July 2024. Everything taxed at slab uses the rate you select.
Health and education cess of 4% is then added to the tax. Surcharge is not modelled, because it depends on your total income rather than on this sale.
It does not net losses against gains. Real capital gains tax is computed across all your transactions in a year, with short-term losses available against both short and long-term gains, long-term losses only against long-term gains, and unabsorbed losses carried forward for eight years. That is a return-level calculation and this page is a single-transaction one.
It does not model surcharge, which applies above ₹50 lakh of total income and is capped at 15% on most capital gains.
It does not model the exemptions available on reinvesting a property gain in another house or in specified bonds, which can eliminate the tax entirely for someone who qualifies.
And it does not know your cost base. For units bought through a SIP, each instalment is a separate purchase with its own date and price, redeemed oldest first, so a redemption usually spans both short and long-term holdings. Run it per tranche or use your registrar’s statement.
Held over twelve months, gains are long term and taxed at 12.5%, with the first ₹1,25,000 of long-term equity gains in a financial year exempt. Held twelve months or less, gains are short term and taxed at 20% with no exemption.
Both rates date from 23 July 2024, when long-term equity moved from 10% to 12.5%, short-term from 15% to 20% and the exemption from ₹1 lakh to ₹1.25 lakh. Pages still quoting 10% and ₹1 lakh are two years out of date.
At your slab rate, whatever the holding period, with no indexation, for units bought on or after 1 April 2023. There is no long-term category for them at all.
This is the single most commonly wrong thing on Indian tax pages. Before April 2023 a debt fund held three years was taxed at 20% with indexation, which for a long holding in a high-inflation period could reduce the effective rate to almost nothing. That is gone. Units bought before that date keep the old treatment, which is why the purchase date matters more than the sale date.
Per financial year, across all your long-term equity gains. Not per sale, not per fund, not per folio. If you have already booked ₹1 lakh of long-term equity gains this year, only ₹25,000 of exemption remains for the next sale. Almost no calculator asks, which is why the field is on this one. It also does not apply to short-term gains at all.
Held over twenty-four months the gain is long term, and there are two routes. The default is 12.5% on the plain gain with no indexation. For property acquired before 23 July 2024, you may instead compute the gain after indexing the cost and pay 20% on that, choosing whichever produces less tax. Held twenty-four months or less, the gain is short term and taxed at your slab rate. Exemptions for reinvesting in another house or in specified bonds can remove the liability and are not modelled here.
Each instalment is a separate purchase with its own date and price, and redemptions are matched oldest first. So a redemption after three years of monthly investing sells units that are three years old, and a redemption of a larger amount may reach units bought within the last twelve months, which are short term at 20%. The practical answer is to take the capital gains statement from your registrar rather than compute it, and use this page to understand what it is telling you.
Yes, and this page does not do it. Short-term capital losses can be set against both short-term and long-term gains; long-term losses only against long-term gains. Anything unabsorbed carries forward for eight assessment years, provided the return is filed on time, which is the condition people miss. Where you are sitting on both gains and unrealised losses, the order and timing of what you sell genuinely matters.
Selling a holding that is down to realise the loss, setting it against gains you have booked, and reinvesting. It works, and the mirror image works better for most people: using the ₹1.25 lakh annual exemption by booking gains rather than losses. The LTCG harvesting calculator works out how much to redeem and rebuy each year to use the exemption in full.
Capital gains fall within advance tax, which is due in instalments through the year, with the instalment for a gain due in the quarter it was realised. Interest runs on any shortfall. For a large sale this is the part people are caught by: the tax is not something to think about at filing time nine months later, and no TDS was withheld to cover it if you are a resident.
12.5% on long-term gains above ₹1,25,000 in a financial year, for units or shares held more than twelve months. Short-term gains are taxed at 20%. Both rates have applied since 23 July 2024.
Not for units bought on or after 1 April 2023. Those are taxed at your slab rate whatever the holding period, with no indexation and no long-term category. Units bought before that date retain the old treatment.
Yes, it resets each financial year and applies across all your long-term equity gains combined. It cannot be carried forward, which is the argument for using it deliberately rather than letting it lapse.
Held over twenty-four months, the gain is long term and taxed at 12.5% without indexation. Held less, it is added to your income and taxed at your slab rate. This applies to physical gold and to gold funds and ETFs.
Yes. A switch is a redemption from one scheme and a fresh purchase in another, so it realises a gain exactly as a sale would, even though no money reached your bank account. The same applies to switching between plans of the same fund.
No. It is arithmetic on the rules as they stand for FY 2026-27 under the Income-tax Act, 2025, checked on 20 August 2026. Zenith is an AMFI-registered mutual fund distributor and not a tax practitioner. Anything involving losses, surcharge or property exemptions is worth taking to one.
Talk to the desk
Which units go first, which year the gain falls in and whether the exemption has already been used are all decisions that exist while you still hold the asset. Bring the position and we will look at it with you.
Tax rates shown are those in force for FY 2026-27 under the Income-tax Act, 2025, as amended 23 July 2024 and checked on 20 August 2026. This is arithmetic on stated rules, not tax advice.
