Capital Gains Calculator

Understanding Capital Gains Tax

Capital gains arise when you sell an asset (stocks, property, gold, MF) at a profit. Tax depends on asset type and holding period (Long-term vs Short-term).

Capital Gains Tax Rates (FY 2024-25)

Equity / Equity Mutual Funds

• STCG (<12 months): 15% flat (plus 4% cess)
• LTCG (≥12 months): 10% on gains >₹1 lakh (₹1L exemption per year)
• STT Required: Must be STT-paid transactions
• Grandfathering: Cost basis as of Jan 31, 2018 for old holdings

Property / Real Estate

• STCG (<24 months): Taxed as per income tax slab (up to 30%)
• LTCG (≥24 months): 20% with indexation benefit
• Indexation: Adjusts purchase cost for inflation (CII index)
• Exemptions: Sections 54, 54EC (reinvest in property/bonds)

Debt Mutual Funds (Post Apr 2023)

• No LTCG Benefit: All gains taxed as per slab rate
• Treatment: Added to income, taxed at marginal rate
• Impact: Debt MF lost tax advantage (was 20% with indexation)

Example Calculations

Example 1: Equity LTCG

Example 2: Equity STCG

Example 3: Property LTCG with Indexation

₹1 Lakh LTCG Exemption (Equity)

• Available per financial year (Apr-Mar)
• Across all equity/equity MF transactions combined
• Example: ₹80K gain on stocks + ₹40K on equity MF = ₹1.2L total → Tax on ₹20K only
• Cannot be carried forward

Indexation Benefit

• Applies to: Property, gold, debt MF (pre-Apr 2023)
• Formula: Indexed Cost = Purchase Cost × (Sale Year CII / Purchase Year CII)
• Benefit: Reduces taxable gain by adjusting for inflation
• CII: Cost Inflation Index published annually by govt

Capital Gains Exemptions

• Section 54: Residential property → Reinvest in another house (2 years)
• Section 54EC: Property → Invest in REC/NHAI bonds (₹50L max)
• Section 54F: Any asset → Buy residential property
• Section 112A: ₹1L equity LTCG exemption

Grandfathering (Equity)

• Shares bought before Jan 31, 2018 → Cost = Higher of (Purchase Price, Jan 31 2018 Price)
• Protects pre-2018 gains from LTCG tax
• Example: Bought @ ₹100 in 2015, Price on Jan 31 2018 = ₹200 → Cost basis = ₹200

Set-Off and Carry Forward

• STCG Loss: Can offset against STCG or LTCG
• LTCG Loss: Can offset only against LTCG
• Carry Forward: Up to 8 years (must file ITR on time)
• Example: ₹50K STCG + (₹30K) LTCG loss = Tax on ₹50K only

Common Mistakes

• ❌ Not using ₹1L LTCG exemption (equity)
• ❌ Selling equity just before 12 months (pays 15% vs 10%)
• ❌ Not claiming indexation on property
• ❌ Not filing ITR to carry forward losses
• ❌ Ignoring Section 54 exemption (property reinvestment)

Pro Tips

• Hold equity for 12+ months to get LTCG benefit (10% vs 15%)
• Use ₹1L LTCG exemption every year (don't accumulate)
• For property, always claim indexation (saves 20-40% tax)
• Offset gains with losses (harvest losses in March)
• Reinvest property gains in Section 54 bonds to save tax
• File ITR even if income below threshold (to carry forward losses)