Free LTCG tax calculator for India FY 2025-26. Calculate long-term capital gains on shares, property & mutual funds with indexation. Section 112 & 112A.
If you have sold stocks, property, or mutual funds and want to know exactly how much LTCG tax you owe, you have landed on the right page. LTCG tax — or long-term capital gains tax — is one of the most misunderstood topics in personal finance in India. Most investors overpay their LTCG taxation simply because they do not apply indexation correctly or confuse the LTCG tax rate with regular income tax slabs. This free
LTCG tax calculator helps you compute your exact tax liability in seconds, updated for FY 2025-26 as per the latest rules under
Section 112 of the Income Tax Act, 1961. Whether you are a salaried employee selling TCS shares bought 5 years ago, a retiree liquidating your equity portfolio, an NRI selling Indian stocks, or a homeowner selling a flat purchased a decade back — this LTCG tax calculator covers every scenario. Read this complete guide, understand every rule, and never overpay your LTCG tax again.
✓ FY 2025-26 Updated✓ LTCG & STCG Rules Applied✓ Indexation Benefit Calculated✓ Residents & NRIs Covered✓ Shares, Property & Mutual Funds✓ Section 112 & 112A Compliant
What This LTCG Tax Calculator Covers
This
LTCG tax calculator and
capital gains tax calculator India is built specifically for FY 2025-26 (April 2025 to March 2026). Whether you want to calculate LTCG tax on shares, use it as an LTCG calculator for property, or determine the LTCG tax on mutual fund — here is exactly what it handles:
- Asset Types Supported
- Taxpayer Types
- Types of Capital Gains Covered
- Tax Components Calculated
What is LTCG Tax? (Long-Term Capital Gains Tax Explained Simply)
LTCG tax stands for Long-Term Capital Gains Tax. It is the tax you pay on the profit — called a 'capital gain' — you earn when you sell a capital asset that you have held for a specified period. In India, the LTCG tax rate and the minimum holding period both vary depending on the type of asset — equity shares, immovable property, debt mutual funds, or gold.
Here is the plain-English version: If you bought 100 shares of HDFC Bank for ₹10,000 and sold them 2 years later for ₹18,000, your capital gain is ₹8,000. Since you held for more than 12 months, this is classified as a long-term capital gain, and LTCG tax applies at a flat rate (with indexation benefit available on certain assets). This is far more beneficial than paying 30% under income tax slabs.
The key legislation governing LTCG taxation in India is
Section 112 of the Income Tax Act, 1961 for most long-term capital assets — covering property, gold, unlisted shares, and old debt mutual funds at 20% with indexation. For listed equity shares and equity-oriented mutual funds,
Section 112A governs LTCG above ₹1,25,000 at 10% without indexation.
Understanding the difference between LTCG and
short-term capital gains (STCG) is the first step to reducing your tax bill. The LTCG tax brackets are far more favourable, and for older assets, the indexation benefit can reduce your taxable gain by 40–60%.
Holding Period for LTCG Tax in India — FY 2025-26
The holding period — how long you have owned an asset before selling it — is the single most important factor when determining whether your gain qualifies as long-term. This classification directly determines your LTCG tax rate and can change your tax bill dramatically.
For Listed Equity Shares and Equity Mutual Funds (Section 112A):If you sell listed shares or equity mutual funds that you have held for more than 12 months, it qualifies as Long-Term Capital Gain (LTCG). Hold for 12 months or less and it becomes
Short-Term Capital Gain (STCG), taxed at 20% under Section 111A (revised in Budget 2024 from 15% to 20%).
For Property and Real Estate (Section 112):Immovable property must be held for more than 24 months to qualify as LTCG. Property sold within 24 months is treated as STCG — added to your total income and taxed at your slab rate, which can be up to 30%. This is why the holding period is one of the first things this LTCG calculator for property checks when you enter your purchase and sale dates.
For Physical Gold (Section 112):Gold has a slightly longer holding period requirement. You need to hold it for more than 36 months (3 years) to qualify for LTCG treatment. Gold sold within 36 months is STCG.
For Debt Mutual Funds (Section 112 — purchased before April 1, 2023):Old debt mutual funds must be held for more than 36 months to qualify for LTCG at 20% with indexation.
For Unlisted Equity Shares (Section 112):Unlisted shares must be held for more than 24 months to qualify for LTCG treatment at 20% with indexation.
Why Does the Holding Period Matter So Much?The difference in tax can be enormous. Long-term gains are taxed at flat rates of 10% to 20%, while short-term gains can be taxed at up to 30% depending on your total income. Here is a quick real-world example: You buy a property for ₹50 lakh. You sell it for ₹1 crore. If you sold at 26 months (LTCG), you pay approximately ₹6.25 lakh in tax. If you sold at 22 months (STCG) and your income is in the 30% slab, you could pay ₹15 lakh or more. That is a difference of nearly ₹9 lakh just for waiting a few extra months.
LTCG Tax Rate FY 2025-26 — Complete Rate Guide for All Asset Classes
Understanding the current LTCG tax rate is essential because it directly determines how much of your profit you keep. The LTCG tax rate in India for FY 2025-26 depends on the asset class and — critically — on when you purchased the asset. Budget 2024 (effective July 23, 2024) brought significant changes to LTCG tax rates and indexation rules.
LTCG Tax Rate on Listed Equity Shares & Equity Mutual Funds (Section 112A):LTCG tax rate: 10% flat on gains exceeding ₹1,25,000 in a financial year (limit increased from ₹1,00,000 in Budget 2024). No indexation benefit is available. STT (Securities Transaction Tax) must have been paid on both purchase and sale. This is the LTCG tax rate that applies when you calculate LTCG on share holdings.
LTCG Tax Rate on Property — Budget 2024 Choice:This is where the biggest change from Budget 2024 applies. For property acquired BEFORE July 23, 2024, you get to choose:
→ Option A: Pay 12.5% LTCG tax WITHOUT indexation benefit
→ Option B: Pay 20% LTCG tax WITH indexation benefit (using the official
Cost Inflation Index published by CBDT)
For property acquired AFTER July 23, 2024: Only 12.5% without indexation applies.
LTCG Tax Rate on Gold, Unlisted Shares, and Old Debt Mutual Funds (Section 112):Same choice as property for assets purchased before July 23, 2024: 12.5% without indexation OR 20% with indexation. Assets purchased after July 23, 2024: 12.5% without indexation only.
LTCG Tax Rate on Debt Mutual Funds Purchased After April 1, 2023:The Finance Act 2023 removed the LTCG benefit entirely for newly purchased debt mutual funds. All gains, regardless of holding period, are now taxed at your income tax slab rate.
A Simple Way to Think About It:For older assets, indexation increases your purchase cost on paper to account for inflation. If you bought property for ₹1 crore in 2015 and the Cost Inflation Index pushes that to ₹1.6 crore by the time you sell, your taxable gain is calculated on the difference from ₹1.6 crore — not ₹1 crore. That means significantly less LTCG tax. For older properties bought before 2018, the 20% with indexation option typically wins. For recent purchases, 12.5% without indexation is usually better. This
LTCG calculator does all of this automatically.
The following table gives you an at-a-glance view of current LTCG tax rates for all asset classes in India for FY 2025-26:
After calculating your base LTCG tax at the applicable rate, surcharge and cess are added on top. The LTCG tax brackets for surcharge are based on your total annual income including the capital gain — not just the gain alone. Short-term capital gains are added to your total income; below are the income tax slabs under the New Tax Regime for FY 2025-26:
Indexation for LTCG — What It Is and How It Reduces Your LTCG Tax
Indexation is one of the most powerful LTCG tax-saving tools available in India — yet most people either do not know about it or forget to apply it. This section explains exactly how indexation for LTCG works and when to use it.
What Is Indexation for LTCG?Indexation adjusts your original purchase price upward to account for inflation over the years. The government publishes a
Cost Inflation Index (CII) every year through CBDT. You use the CII for the year you bought the asset and the year you are selling it to calculate your inflation-adjusted cost. The result is called the Indexed Cost of Acquisition, and this higher cost reduces your taxable LTCG amount significantly.
The LTCG Calculation Formula with Indexation:Indexed Cost of Acquisition = (Original Purchase Price × CII of Sale Year) ÷ CII of Purchase Year
LTCG Amount = Sale Price − Indexed Cost of Acquisition − Transfer Expenses
LTCG Tax = LTCG Amount × 20%
Total Tax = LTCG Tax + Surcharge (if applicable) + 4% Health & Education Cess
Official CII Values for LTCG Calculation (as published by CBDT):Always verify the latest CII values from the
official Income Tax Department CII table before finalising your LTCG tax calculation.
Real LTCG Calculation Example with Indexation:You purchased shares of Infosys at ₹5,00,000 in FY 2012-13 (CII = 200) and sold them in FY 2024-25 for ₹22,00,000 (CII = 363).
Indexed Cost = ₹5,00,000 × (363 ÷ 200) = ₹5,00,000 × 1.815 = ₹9,07,500
LTCG Amount = ₹22,00,000 − ₹9,07,500 = ₹12,92,500
LTCG Tax (at 20%) = ₹12,92,500 × 20% = ₹2,58,500
Add 4% Cess = ₹2,58,500 × 4% = ₹10,340
Total LTCG Tax Payable = ₹2,68,840
Without indexation, your tax would have been: (₹22,00,000 − ₹5,00,000) × 20% = ₹17,00,000 × 20% = ₹3,40,000 + cess = ₹3,53,600. The indexation benefit saved you ₹84,760 in taxes on this single transaction.
Who Gets Indexation for LTCG?Only assets acquired BEFORE July 23, 2024 qualify for the indexation choice. Assets bought on or after that date must use the 12.5% flat LTCG tax rate without indexation. This
LTCG calculator automatically pulls the relevant CII values and shows you both options side by side so you can make the right choice.
After your LTCG tax is calculated at the base rate, surcharge and cess are added on top. These apply to all taxpayers depending on total income. This is what makes the LTCG tax brackets critical — surcharge alone can add 10% to 37% more to your LTCG tax bill:
Surcharge and Cess on LTCG Tax — The Hidden Additions Most Investors Forget
Many investors calculate their LTCG tax correctly but forget about surcharge and cess. These two components can add 10–40% more to your base LTCG tax bill, depending on your total income. Surcharge is not charged on your capital gain directly — it is charged on the LTCG tax amount you have already calculated. The rate depends on your total annual income for the year — not just the gain from this sale.
Note: For LTCG under Section 112A (equity shares and equity mutual funds), the maximum surcharge is capped at 15%, regardless of how high your income is. This is a significant benefit for high-income equity investors. For LTCG under Section 112 (property, unlisted shares, etc.), the full uncapped surcharge applies.
Income up to ₹50 lakh — No Surcharge
₹50 lakh to ₹1 crore — 10% Surcharge
₹1 crore to ₹2 crore — 15% Surcharge
₹2 crore to ₹5 crore — 25% Surcharge
Above ₹5 crore — 37% Surcharge (25% capped for Section 112A)
Health and Education Cess — 4% for Everyone
LTCG Tax on Shares — Complete Rules for FY 2025-26
LTCG tax on shares is one of the most commonly searched topics in India, and for good reason — millions of equity investors face this every year. The LTCG tax on shares (listed equity) is governed by Section 112A of the Income Tax Act, not Section 112. Here are all the critical rules:
Holding Period for LTCG on Share:More than 12 months from the date of purchase. Shares sold on exactly the 12-month mark would be STCG, not LTCG. To calculate LTCG on share holdings, you need the exact purchase and sale dates.
LTCG Tax Rate on Shares:10% flat on LTCG gains exceeding ₹1,25,000 in a financial year (limit increased from ₹1,00,000 in Budget 2024). No indexation benefit is available for listed equity shares. STT (Securities Transaction Tax) must have been paid on both purchase and sale for the 10% rate to apply.
Grandfathering Clause for Pre-2018 Shares:For shares purchased before January 31, 2018, the cost of acquisition is taken as the HIGHER of: (a) actual cost paid, or (b) the highest quoted price on January 31, 2018 on BSE/NSE. This grandfathering provision was introduced when LTCG on shares was reintroduced in Budget 2018 after a 14-year exemption. This is crucial when you calculate LTCG on share transactions from before 2018.
Real Example — Calculate LTCG Tax on Share Sale:You bought 500 shares of Reliance Industries at ₹400 each (total ₹2,00,000) in June 2022 and sold all 500 at ₹1,200 each (total ₹6,00,000) in September 2024.
LTCG = ₹6,00,000 − ₹2,00,000 = ₹4,00,000
Exempt amount = ₹1,25,000
Taxable LTCG = ₹4,00,000 − ₹1,25,000 = ₹2,75,000
LTCG tax at 10% = ₹27,500 + 4% cess = ₹28,600
LTCG Tax Free Limit for Shares:₹1,25,000 per financial year is completely exempt from LTCG tax for listed equity shares and equity mutual funds. This is the LTCG tax free limit under Section 112A. Any LTCG above ₹1,25,000 is taxed at 10%. Savvy investors use this limit strategically — redeeming units every year to book up to ₹1,25,000 of tax-free LTCG. See the
LTCG tax calculator to compute your exact LTCG tax on shares.
For more information on the LTCG tax on shares rules, refer to the official
Section 112A of the Income Tax Act, 1961.
LTCG Tax on Property — Complete Guide for FY 2025-26
LTCG tax on property is one of the biggest tax decisions homeowners and real estate investors face. The rules changed significantly in Budget 2024, and getting this wrong can cost you lakhs. Here is everything you need to know about LTCG tax on sale of property in India.
Holding Period for LTCG on Property:As per
Section 2(42A) of the Income Tax Act, immovable property (house, land, commercial property) must be held for MORE than 24 months to qualify as a long-term capital asset. If you sell before 24 months, it becomes STCG taxed at your slab rate.
LTCG Tax Rate on Property — Budget 2024 Change:After Budget 2024 (effective July 23, 2024), homeowners with property acquired BEFORE July 23, 2024 have TWO options:
→ Option A: Pay 12.5% LTCG tax WITHOUT indexation
→ Option B: Pay 20% LTCG tax WITH indexation benefit
You pick whichever option gives you a LOWER final tax. For most properties bought before 2018, Option B with indexation gives lower tax because inflation adjustment significantly reduces the gain. This
capital gains tax calculator India and LTCG calculator for property computes both options automatically.
Real Example — Calculate LTCG Tax on Property:You purchased a flat in Mumbai for ₹40,00,000 in FY 2010-11 (CII = 167) and sold it in FY 2024-25 for ₹1,20,00,000 (CII = 363).
Option A — 12.5% without indexation:
LTCG = ₹1,20,00,000 − ₹40,00,000 = ₹80,00,000
LTCG Tax = 12.5% × ₹80,00,000 = ₹10,00,000
Option B — 20% with indexation:
Indexed Cost = ₹40,00,000 × (363 ÷ 167) = ₹86,94,611
LTCG = ₹1,20,00,000 − ₹86,94,611 = ₹33,05,389
LTCG Tax = 20% × ₹33,05,389 = ₹6,61,078
Verdict: Option B saves ₹3,38,922 in this case. Always calculate LTCG on property under both methods before choosing.
What Can Be Added to Your Cost of Acquisition?When computing LTCG tax on sale of property, these costs can be added to your original purchase price to reduce your capital gain: stamp duty and registration charges paid at purchase, cost of improvements and renovation (with bills/receipts), legal charges directly related to the purchase, and brokerage paid to buy the property.
For complete details on the LTCG tax rate on property and official exemption sections, refer to
Section 112 of the Income Tax Act and the
CBDT Circular No. 6/2024 on Budget 2024 property LTCG changes.
LTCG Tax on Mutual Fund — What Changed in 2023 and 2024
The rules for LTCG tax on mutual fund investments have changed significantly in recent years. Here is the complete, up-to-date position for FY 2025-26 — including the Finance Act 2023 changes and Budget 2024 updates.
Equity Mutual Funds (more than 65% equity exposure):LTCG tax rate: 10% above ₹1,25,000 gain per year (Section 112A). Holding period for LTCG: more than 12 months. No indexation benefit. This is the same as LTCG tax on shares for listed equity.
ELSS Mutual Funds (Equity Linked Savings Scheme):ELSS has a mandatory 3-year lock-in period. After the lock-in, gains are treated as LTCG under Section 112A — 10% tax above ₹1,25,000, no indexation. LTCG applicable on ELSS funds makes them highly tax-efficient. To calculate LTCG on ELSS, use the same formula as equity mutual funds.
Debt Mutual Funds — PURCHASED BEFORE April 1, 2023:These still qualify for LTCG after 36 months of holding. You get the choice: 12.5% without indexation OR 20% with indexation (for funds bought before July 23, 2024). This is a valuable tax benefit that should not be surrendered without calculating both options in the LTCG calculator.
Debt Mutual Funds — PURCHASED AFTER April 1, 2023:The Finance Act 2023 removed the LTCG and indexation benefit for newly purchased debt mutual funds. All gains are now taxed at your income tax slab rate regardless of holding period. Refer to
Finance Act 2023 — Income Tax Department for the complete notification.
Hybrid Funds (35%–65% equity):For hybrid funds with equity exposure between 35% and 65% purchased before April 1, 2023: LTCG rules apply after 36 months with indexation choice. For funds purchased after April 1, 2023: slab rate applies.
Long Term Capital Gain on Debt Mutual Fund — Example:You invested ₹10,00,000 in a debt mutual fund in FY 2018-19 (CII = 280) and redeemed in FY 2024-25 for ₹17,00,000 (CII = 363).
Without indexation: LTCG = ₹7,00,000. Tax at 12.5% = ₹87,500.
With indexation: Indexed Cost = ₹10,00,000 × (363 ÷ 280) = ₹12,96,429. LTCG = ₹17,00,000 − ₹12,96,429 = ₹4,03,571. Tax at 20% = ₹80,714.
Option B (with indexation) saves ₹6,786 in this case.
For mutual fund LTCG tax calculations, you can also use the
capital gains tax calculator India on this platform.
LTCG and STCG Tax Rate Comparison — Why Long-Term Holding Always Pays Off
One of the most powerful reasons to use this LTCG tax calculator is to see exactly how much you save by holding investments long-term versus short-term. The LTCG and STCG tax rate difference is enormous and strongly incentivises patient, long-term investing.
- Listed Equity Shares — STCG vs LTCG
- Property — STCG vs LTCG
- Debt Mutual Funds (old) — STCG vs LTCG
- Gold — STCG vs LTCG
NRI LTCG Tax — Rules for Non-Resident Indians Selling Indian Assets
NRI LTCG tax works differently from resident Indians in terms of TDS (Tax Deducted at Source), though the actual LTCG tax rates are largely the same. Here is what every NRI selling Indian assets must know. Understanding NRI LTCG tax is especially important because TDS deductions are large and refunds go unclaimed when ITR is not filed.
- NRI LTCG Tax Rate — Same as Residents
- TDS on NRI Property Sale — The Critical Difference
- TDS Is Not Final NRI LTCG Tax — File ITR to Claim Refund
- Lower TDS Certificate for NRIs
- DTAA Benefit for NRIs
LTCG Tax on Unlisted Shares — Rules Under Section 112
LTCG tax on unlisted shares — shares of private companies not listed on BSE or NSE — follows Section 112 of the Income Tax Act. This is particularly relevant for startup founders, early employees with ESOPs, and investors in private equity.
- Holding Period for LTCG on Unlisted Shares
- LTCG Tax Rate on Unlisted Shares
- Fair Market Value for Gifted Unlisted Shares
- Startup Employee ESOPs — LTCG on Unlisted Shares
LTCG Loss — How to Set Off and Carry Forward Long-Term Capital Losses
Most investors do not know that LTCG losses can be strategically used to reduce overall LTCG taxation. Here are the complete rules for LTCG loss under the Income Tax Act — understanding these can save you significant money.
Rule 1: LTCG Loss Can Only Be Set Off Against LTCG Gains
You CANNOT use an LTCG loss to reduce STCG or regular income. LTCG loss can only be set off against LTCG gains in the same financial year. For example, if you have ₹5 lakh LTCG from equity shares and ₹3 lakh LTCG loss from an unlisted share sale, you can set off the loss and pay LTCG tax only on the net ₹2 lakh gain.
Rule 2: Excess LTCG Loss Carries Forward for 8 Years
If your LTCG losses exceed LTCG gains in a year, the balance LTCG loss can be carried forward for up to 8 assessment years. This carried-forward LTCG loss can be used to set off future LTCG gains — year after year — for the next 8 years.
Rule 3: Section 112A LTCG Loss vs Section 112 LTCG Loss
LTCG loss from Section 112A (equity shares and equity mutual funds) can set off LTCG gains from Section 112A only. It cannot be used against property LTCG under Section 112. Cross-section loss set-off is not permitted.
Rule 4: File ITR to Carry Forward LTCG Losses
This is critical: LTCG losses can only be carried forward if you FILE YOUR ITR ON TIME. If you miss the ITR due date for the year in which the LTCG loss occurred, you lose the right to carry forward those losses permanently.
Tax Loss Harvesting Strategy:
Savvy equity investors deliberately book LTCG losses at year-end (March) to set off against LTCG gains from other assets, thereby reducing their net LTCG taxation for the year. They then repurchase the same units/shares after a brief period to maintain their investment exposure. This is a completely legal strategy. For LTCG tax filing and loss set-off reporting, refer to the
ITR-2 form from the Income Tax Department.
LTCG Tax Saving Strategies — Legal Ways to Reduce Your Long-Term Capital Gains Tax
LTCG taxation is real money — and there are multiple fully legal strategies to reduce your LTCG tax burden. Here are the most effective approaches:
Strategy 1: Section 54 — Reinvest in Residential PropertyIf you sell a residential house property and have LTCG, you can claim FULL exemption under
Section 54 of the Income Tax Act by purchasing another residential house property within 2 years (or constructing within 3 years) of the sale. From Budget 2023, you may buy up to TWO residential properties (instead of one) once in a lifetime, provided the LTCG does not exceed ₹2 crore.
Strategy 2: Section 54EC — Invest in NHAI or REC BondsYou can invest up to ₹50,00,000 per financial year in specified bonds issued by
NHAI (National Highways Authority of India) or REC (Rural Electrification Corporation) within 6 months of the property sale. The amount invested in these bonds is directly deducted from your LTCG, reducing your LTCG taxation rupee-for-rupee. These bonds carry a 5-year lock-in period and earn a modest interest rate.
Strategy 3: Section 54F — Sell Any Capital Asset and Buy Residential PropertyUnlike Section 54 (which requires selling a house), Section 54F lets you sell ANY long-term capital asset — shares, gold, commercial property, etc. — and claim LTCG exemption by investing the FULL SALE PROCEEDS (not just the gain) in a new residential property. Proportional exemption applies if only partial investment is made. This is one of the most powerful LTCG tax saving tools in India.
Strategy 4: Annual LTCG Tax Harvesting for EquityUse the ₹1,25,000 LTCG tax free limit under Section 112A every year. Redeem and reinvest equity mutual fund units or shares to book up to ₹1,25,000 of LTCG completely tax-free each financial year. This resets your cost basis and ensures you never accumulate a large taxable LTCG in future. This annual exercise is called tax harvesting and is widely used by informed equity investors.
Strategy 5: Strategic Timing of SalePlan your property or equity sales in a financial year where your other income is lower — this reduces the surcharge bracket for LTCG taxation. If your income crosses ₹50 lakh, ₹1 crore, or ₹2 crore thresholds with the capital gain included, delaying the sale to the next financial year might avoid surcharge entirely.
Strategy 6: Carry Forward LTCG LossesIf you have any assets with unrealised LTCG losses, consider booking them in the same year as your large LTCG gain. The LTCG loss directly reduces your taxable LTCG, saving you LTCG tax rupee for rupee (within the same section category — 112A against 112A, 112 against 112).
Always consult a qualified
Chartered Accountant (CA) before implementing any LTCG tax saving strategy, as individual circumstances, multiple-asset interactions, and recent law changes can affect outcomes.
How This LTCG Tax Calculator Works — Step by Step
- Step 1: Select Your Asset Type
Choose whether you are computing LTCG tax on shares (listed equity), property, mutual fund, gold, unlisted shares, or bonds. Each asset type has different holding period thresholds and LTCG tax rates. The LTCG calculator automatically applies the right Section (112 or 112A) based on your selection.
- Step 2: Check Your Residency Status
Select whether you are a Resident Individual or an NRI (Non-Resident Indian). You are Resident if you stayed in India for 182+ days in the financial year (April to March), OR 60+ days in the current year and 365+ days in the preceding 4 years combined. If neither condition applies, you are an NRI. This matters because TDS rules for NRI LTCG tax differ significantly from residents.
- Step 3: Enter Purchase and Sale Dates
Enter your date of purchase and date of sale. The LTCG tax calculator automatically calculates the holding period and tells you whether it qualifies as LTCG or STCG — no manual month counting needed. For shares: over 12 months = LTCG. For property and unlisted shares: over 24 months = LTCG. For gold and old debt funds: over 36 months = LTCG.
- Step 4: Enter Purchase Cost and Sale Price
LTCG Amount = Sale Price – Purchase Cost (or Indexed Cost if indexation applies). Enter the actual amount you paid when you bought the asset — including stamp duty, registration charges, and improvement costs for property. Use the real figure from your sale deed or broker contract note. The accuracy of your LTCG tax calculation depends entirely on these two numbers.
- Step 5: The Calculator Applies the Right LTCG Tax Rate
For LTCG (qualifying holding period met): Asset acquired after July 23, 2024 → 12.5% flat rate, no indexation. Asset acquired before July 23, 2024 → Calculator shows both options — 12.5% without indexation AND 20% with indexation using official CII values — and highlights which gives lower LTCG tax. For listed equity under Section 112A → 10% above ₹1,25,000. For STCG (holding period not met) → gain is added to total income and taxed at slab rates. Use the
short-term capital gains tax calculator India for STCG-specific computations.
- Step 6: Enter Your Total Annual Income for Surcharge
Enter your total annual income for the year including this capital gain. This determines your LTCG tax brackets for surcharge. Surcharge is applied on the LTCG tax amount — not the gain itself. If your total income is ₹80 lakh and your LTCG tax is ₹12.5 lakh, surcharge is 10% of ₹12.5 lakh = ₹1.25 lakh. Ignoring surcharge is the most common mistake high-income investors make when computing LTCG taxation.
- Step 7: 4% Cess Is Added Automatically
Health & Education Cess = (LTCG Tax + Surcharge) × 4%. This is mandatory for all taxpayers without exception. The LTCG calculator adds this automatically. Total LTCG Tax = Base LTCG Tax + Surcharge + Cess.
- Step 8: NRI LTCG Tax — TDS Shown Separately
If you are an NRI, the calculator shows TDS deducted at source (20% of sale price for LTCG property, 30% for STCG property) versus your final NRI LTCG tax liability. If TDS exceeds your final tax, you are owed a refund — which you can only claim by filing your ITR. Check your
Annual Information Statement (AIS) to verify TDS amounts deducted.
How to Use This LTCG Tax Calculator — Simple Steps
- 1. Select Asset Type
Choose your asset: listed equity shares, property, gold, debt mutual fund, unlisted shares, or ELSS. This single selection determines which holding period threshold and LTCG tax rate the calculator applies. Do not select the wrong asset type — equity and property follow completely different LTCG rules under different sections of the Income Tax Act.
- 2. Choose Resident or NRI
Select your residency status. Resident means you spent 182+ days in India in the financial year. NRI means you did not meet this condition. This single selection changes how TDS, ITR obligations, and NRI LTCG tax are displayed. If you are an NRI selling property, the calculator shows the TDS your buyer must deduct alongside your actual LTCG tax liability.
- 3. Enter Purchase Date and Sale Date
Use the exact month and year you acquired and sold the asset. The LTCG calculator uses these dates to automatically determine holding period and classify your gain as LTCG or STCG. Use the actual date from your sale deed, broker contract note, or share transfer confirmation — not an estimated date.
- 4. Enter Purchase Cost and Sale Price
For shares: use the exact purchase price per share × number of shares from your broker's contract note. For property: use the amount from your sale deed, plus stamp duty and registration charges, plus documented improvement costs. This LTCG tax calculator on sale of property and shares uses these two figures to compute your taxable LTCG. Use exact figures without rounding for accuracy — especially when income is near surcharge thresholds.
- 5. Enter Your Total Annual Income
Include all income sources for the financial year: salary, rental income, business income, and this capital gain itself. Your total income determines the surcharge slab for LTCG taxation. If you are close to ₹50 lakh, ₹1 crore, or ₹2 crore thresholds, this matters enormously — crossing a threshold can add ₹2–10 lakh more in total LTCG tax.
- 6. Choose Indexation Option (If Applicable)
If your asset was acquired before July 23, 2024 and qualifies as LTCG under Section 112, the calculator automatically shows two options: 12.5% without indexation and 20% with indexation for LTCG. It highlights which option gives you lower total tax. For most properties and gold bought before 2020, the 20% with indexation option typically saves more. For recent purchases, 12.5% without indexation usually wins. For equity shares under Section 112A, there is no indexation — 10% flat applies above ₹1,25,000.
- 7. Calculate and Review Your LTCG Tax Results
Instantly see: LTCG amount, applicable LTCG tax rate, base income tax, surcharge, cess, total LTCG tax liability, and your net proceeds after tax. For NRIs, TDS deducted is shown separately alongside the final LTCG tax liability. For pre-July 2024 assets under Section 112, both indexed and non-indexed results are shown side by side.
- 8. Use Results for Financial Planning
Use the LTCG tax breakdown to decide sale timing, plan your ITR filing, or explore whether waiting one more month changes STCG to LTCG. For NRIs, the results help you understand how much NRI LTCG tax refund to expect when you file your ITR. Test multiple scenarios instantly — change sale dates, prices, or income levels to understand the full impact of your LTCG taxation. Always verify your final calculation at the official
Income Tax Department LTCG Calculator before filing.
Real-Life Scenarios — How LTCG Tax Is Calculated
Example 1 — Resident Individual, LTCG Tax on Property (Pre-July 2024 Purchase)
The Situation:
Rajesh bought a residential flat for ₹1 crore in January 2016 (CII for FY 2015-16 = 254). He is selling it in May 2025 (CII for FY 2024-25 = 363) for ₹2.5 crore. His total annual income including this capital gain is ₹1 crore. He wants to know whether to use the 12.5% or 20% LTCG tax rate.
Step 1 — Is It LTCG or STCG?
Holding period: January 2016 to May 2025 = more than 24 months → Long-Term Capital Gain (LTCG) ✓
Step 2 — Option A: 12.5% LTCG Tax Without Indexation
LTCG = ₹2,50,00,000 − ₹1,00,00,000 = ₹1,50,00,000
LTCG Tax at 12.5% = ₹18,75,000
Surcharge (15%, as total income is in ₹1Cr bracket) = ₹2,81,250
Cess (4% on ₹18,75,000 + ₹2,81,250) = ₹86,250
Total Tax = ₹22,42,500
Step 3 — Option B: 20% LTCG Tax With Indexation
Indexed Cost = ₹1,00,00,000 × (363 ÷ 254) = ₹1,42,91,339
LTCG = ₹2,50,00,000 − ₹1,42,91,339 = ₹1,07,08,661
LTCG Tax at 20% = ₹21,41,732
Surcharge (15%) = ₹3,21,260
Cess (4%) = ₹98,520
Total Tax = ₹25,61,512
Verdict: Option A (12.5% without indexation) saves Rajesh ₹3,19,012 in this case. He should use the 12.5% LTCG tax rate. Always calculate both options before deciding — the 'right' choice depends entirely on the specific numbers in your transaction.
Example 2 — Resident Individual, LTCG Tax on Shares
The Situation:
Priya holds a diversified equity portfolio. She sells shares of TCS for a total LTCG of ₹8,00,000 in FY 2025-26. Her other income (salary + rental) is ₹30,00,000. She bought the shares more than 12 months ago.
LTCG Tax Calculation on Shares:
LTCG from shares = ₹8,00,000
Less: LTCG tax free limit under Section 112A = ₹1,25,000
Taxable LTCG = ₹8,00,000 − ₹1,25,000 = ₹6,75,000
LTCG Tax at 10% = ₹67,500
Surcharge:
Total income = ₹30,00,000 (salary) + ₹8,00,000 (LTCG) = ₹38,00,000
This is below ₹50 lakh → Surcharge = 0%
Cess:
4% on ₹67,500 = ₹2,700
Total LTCG Tax on Shares = ₹70,200
If Priya had sold the same shares within 12 months (STCG at 20%): STCG tax = ₹8,00,000 × 20% = ₹1,60,000 + cess = ₹1,66,400. By holding long-term, Priya saved ₹96,200 in LTCG taxation.
Example 3 — NRI Selling Property, LTCG Tax with TDS
The Situation:
Sunita is an NRI living in the UAE. She bought a property in Pune in 2018 for ₹60,00,000 (CII for FY 2017-18 = 272) and is selling it in FY 2024-25 for ₹1,20,00,000 (CII = 363). Her total annual income including this gain is ₹80 lakh.
LTCG Tax Calculation:
Indexed Cost = ₹60,00,000 × (363 ÷ 272) = ₹80,07,353
LTCG = ₹1,20,00,000 − ₹80,07,353 = ₹39,92,647
Option A (12.5% without indexation): LTCG tax = ₹1,20,00,000 − ₹60,00,000 = ₹60,00,000. Tax = 12.5% × ₹60,00,000 = ₹7,50,000.
Option B (20% with indexation): LTCG = ₹39,92,647. Tax = 20% × ₹39,92,647 = ₹7,98,529.
Option A is marginally better in this case.
Base LTCG Tax = ₹7,50,000
Surcharge (10%, total income ₹80L) = ₹75,000
Cess (4% on ₹8,25,000) = ₹33,000
Actual NRI LTCG Tax Liability = ₹8,58,000
TDS Deducted by Buyer (NRI Rule):
20% of ₹1,20,00,000 = ₹24,00,000 TDS
Refund Due:
₹24,00,000 (TDS) − ₹8,58,000 (actual NRI LTCG tax) = ₹15,42,000 refund
Sunita MUST file her ITR to claim this ₹15,42,000 refund. Skipping ITR filing means permanently losing ₹15+ lakh of her own money.
Example 4 — Long-Term Equity Investor, LTCG Tax Harvesting
The Situation:
Akash has been investing in equity mutual funds through SIPs for 10 years. His portfolio has grown to ₹80,00,000 with total unrealised LTCG of ₹50,00,000. He wants to understand how to minimise his LTCG tax using the LTCG tax free limit.
Annual Tax Harvesting Strategy:
Every March, Akash can redeem mutual fund units equivalent to ₹1,25,000 of LTCG — completely tax-free under Section 112A. He immediately reinvests the same amount at the current NAV (new cost basis). Over 10 years, doing this every year means he has already crystallised ₹12,50,000 of LTCG completely tax-free, while resetting his cost basis upward. This reduces his eventual large LTCG taxation when he finally liquidates his portfolio.
If He Did Not Do This:
When Akash eventually sells all units in one year with ₹50,00,000 LTCG: Taxable LTCG = ₹50,00,000 − ₹1,25,000 = ₹48,75,000. LTCG Tax at 10% = ₹4,87,500.
With Annual Harvesting:
Taxable LTCG at final sale = significantly lower because of higher adjusted cost basis from annual reinvestments. The annual LTCG tax free limit under Section 112A is one of the most underutilised tools in equity investing.
How to Report LTCG in Your ITR — LTCG Tax Filing Guide
Correct LTCG tax filing in your Income Tax Return is as important as calculating the LTCG tax correctly. Here is a step-by-step guide to reporting LTCG when you file your ITR:
Step 1: Use the Correct ITR FormLTCG must be reported in ITR-2 (for individuals and HUFs with capital gains but no business income) or ITR-3 (for those with business income plus capital gains). ITR-1 cannot be used if you have any LTCG or STCG. Download the current ITR-2 form from the
Income Tax Department website.
Step 2: Fill Schedule CG (Capital Gains)Report all your LTCG transactions in Schedule CG. You will need: purchase date, sale date, cost price, indexed cost (if applicable), and sale price for each asset. LTCG tax filing requires accurate cost basis documentation.
Step 3: Fill Schedule 112A for Equity LTCGFor listed equity shares and equity mutual funds, all LTCG transactions under Section 112A must be reported individually in Schedule 112A. You need ISIN codes, number of units, purchase and sale values for each security. The grandfathering clause (FMV as on January 31, 2018) must be correctly applied for pre-2018 holdings.
Step 4: Match Form 26AS and AISYour broker or property buyer should have reported the transaction in your Form 26AS or Annual Information Statement (AIS). Check your
Annual Information Statement (AIS) to match reported figures with your own records. Discrepancies can trigger scrutiny notices from the Income Tax Department.
Step 5: Pay Advance Tax if RequiredIf your estimated LTCG tax liability (including surcharge and cess) exceeds ₹10,000 for the year, you must pay advance tax in installments. Due dates: June 15 (15%), September 15 (45%), December 15 (75%), March 15 (100%). Failure to pay advance tax results in interest under Section 234B and Section 234C — an avoidable additional cost on top of your LTCG taxation.
Step 6: Claim Exemptions in Schedule 112 / Schedule EIIf you have invested LTCG proceeds in property (Section 54), NHAI bonds (Section 54EC), or any other qualifying asset (Section 54F), claim the exemption in the relevant schedule of your ITR. These exemptions directly reduce your LTCG taxation — but must be reported correctly in LTCG tax filing to be valid.
Common Mistakes to Avoid When Calculating LTCG Tax
Using estimated purchase price instead of actual cost of acquisition: Always use the exact figure from your original sale deed, broker contract note, or purchase agreement. If you estimate a higher cost than actual, you reduce your reported LTCG — which is not legally defensible and can attract scrutiny. The LTCG tax calculator needs accurate inputs to give accurate outputs.
Getting the holding period wrong by even one month: For equity shares, the line between LTCG and STCG is exactly 12 months. For property and unlisted shares, it is 24 months. For gold and old debt mutual funds, it is 36 months. One month short of the LTCG threshold can mean paying 10–20% more in tax. Always count from the exact date of acquisition to the exact date of sale.
Skipping the indexation calculation for older assets: If your property, gold, or old debt mutual fund was acquired before July 23, 2024, always calculate both the 12.5% without indexation option AND the 20% with indexation option. For assets bought before 2018, the 20% with indexation route often saves ₹5–20 lakh in LTCG tax. This LTCG calculator does this comparison automatically.
Not accounting for total annual income correctly for surcharge: Surcharge on LTCG tax changes at ₹50 lakh, ₹1 crore, and ₹2 crore total income thresholds. If you forget to add this capital gain to your other income, you may seriously underestimate your LTCG taxation. Always enter your complete total annual income including the capital gain.
NRIs assuming TDS is their final LTCG tax: TDS deducted at source on NRI property sales (20-30% of full sale price) is almost always far higher than actual NRI LTCG tax liability. But to get the refund, you MUST file your Income Tax Return. Skipping ITR filing means permanently forfeiting this refund — sometimes ₹10-20 lakh or more.
Not using Section 112A's ₹1,25,000 LTCG tax free limit: Many equity investors pay 10% LTCG tax on their entire gain without deducting the ₹1,25,000 annual exemption. The LTCG tax free limit reduces your taxable LTCG — do not forget to subtract it when computing LTCG tax on shares or equity mutual funds.
Selling near a surcharge threshold without planning: If your total income will cross ₹50 lakh, ₹1 crore, or ₹2 crore because of this capital gain, a small delay in sale to the next financial year might avoid surcharge entirely if your other income is lower then. This is a legal and commonly used LTCG tax planning strategy.
Ignoring the July 23, 2024 cutoff date: This date changed LTCG tax rules significantly. Assets bought before this date have the indexation choice under Section 112. Assets bought after this date have only the 12.5% flat LTCG rate. If you are unsure about your purchase date, check your sale deed before using any LTCG calculator.
Not filing ITR after a capital gain event: Even if your total tax is zero or you believe no LTCG tax is owed, ITR filing is important — especially for NRIs claiming TDS refunds, and for everyone to carry forward LTCG losses. Failure to file can attract notices and penalties from the income tax department.
Confusing LTCG from different sections: LTCG loss under Section 112A (equity) can only be set off against LTCG gains under Section 112A. It cannot be used against property LTCG under Section 112. Mixing up these set-off rules in your ITR can lead to incorrect LTCG tax filing.
Why Use This LTCG Tax Calculator India
Updated for FY 2025-26 LTCG Tax Rules: This LTCG calculator includes all current rules — 10% for Section 112A equity LTCG above ₹1,25,000, 12.5% for post-July 2024 Section 112 LTCG, 20% with indexation for pre-July 2024 assets, progressive STCG slab rates, surcharge from 0% to 37%, and 4% cess. No need to separately look up current LTCG tax rate tables.
Indexation for LTCG Calculated Automatically: For LTCG assets acquired before July 23, 2024 under Section 112, the LTCG calculator shows both tax options side by side — 12.5% without indexation AND 20% with indexation — and highlights which saves more LTCG tax. CII values are built in. On large property or gold sales, this comparison alone can save you ₹5–20 lakh.
Holding Period Auto-Detected for LTCG Classification: Enter your purchase and sale dates and the LTCG calculator instantly classifies your gain as LTCG or STCG. No manual counting of months, no confusion about the 12-month vs 24-month vs 36-month LTCG holding period rules for different assets.
Correct NRI LTCG Tax with TDS Displayed: The NRI LTCG tax section correctly applies TDS rules (30% STCG, 20% LTCG for property). It shows your final NRI LTCG tax liability versus TDS deducted — so you know exactly what refund to claim when you file ITR. NRI LTCG tax can involve large TDS overpayments; this tool helps you track exactly what is owed back.
Surcharge and Cess Never Missed: Many LTCG calculators stop at the base LTCG tax rate. This one goes further — calculating surcharge based on your total income slab and applying 4% cess correctly on combined LTCG tax plus surcharge. High-income sellers often get surprised by surcharge on LTCG taxation; this calculator eliminates that surprise.
Complete LTCG Tax Breakdown: See every component separately — LTCG amount, applicable LTCG tax rate, base income tax, surcharge, cess, total LTCG tax liability, and net proceeds. You understand exactly where every rupee of LTCG tax comes from.
All Major Asset Classes Covered: Equity shares, property, gold, old debt mutual funds, unlisted shares, ELSS — all in one LTCG tax calculator. No need to use multiple tools for different asset types.
Completely Private — No Data Stored: All LTCG tax calculations happen in your browser. No data is sent to any server, stored anywhere, or linked to any account. Calculate your LTCG taxation with complete privacy.
Instant What-If Testing: Want to know what happens if you wait two more months before selling? Just change the sale date and recalculate your LTCG tax. See how surcharge changes if your total income crosses ₹50 lakh or ₹1 crore. Test scenarios instantly without any signup or login.
Simple Language Throughout: LTCG tax calculators are often full of jargon. This tool explains each result in plain language so you understand your LTCG taxation, not just the final number. For the full detailed LTCG guide, also visit the
capital gains tax calculator India page.
This table compares LTCG and STCG tax rate across all major asset classes for FY 2025-26 to help you understand exactly how much LTCG taxation saves versus short-term selling:
LTCG Tax Terms — Simple Glossary
LTCG Tax (Long-Term Capital Gains Tax)The tax payable on profit earned from selling a capital asset held for longer than the qualifying holding period. LTCG tax rates in India range from 10% (equity shares under Section 112A) to 20% (property and other assets under Section 112). The LTCG tax brackets for surcharge depend on your total annual income.
LTCG RateThe applicable percentage tax rate on long-term capital gains. The current LTCG rate for listed equity shares is 10% (Section 112A). For property, unlisted shares, gold, and old debt mutual funds, the LTCG rate is either 12.5% (without indexation) or 20% (with indexation) — whichever gives lower tax for pre-July 2024 purchases.
LTCG TaxationThe entire system of rules governing how long-term capital gains are identified, computed, and taxed in India. LTCG taxation covers holding period classification, LTCG rate selection, indexation benefit application, surcharge calculation, and ITR filing requirements.
LTCG Tax BracketsThe surcharge rate structure applied on top of base LTCG tax. LTCG tax brackets are determined by total annual income: 0% surcharge (up to ₹50L), 10% (₹50L–₹1Cr), 15% (₹1Cr–₹2Cr), 25% (₹2Cr–₹5Cr), 37% (above ₹5Cr). For Section 112A equity LTCG, surcharge is capped at 15%.
LTCG CalculatorA tool to compute your LTCG amount and resultant LTCG tax, factoring in indexed cost of acquisition, applicable exemptions, surcharge, and cess. This
LTCG calculator covers shares, property, mutual funds, gold, and unlisted shares.
LTCG Tax Free LimitThe annual exemption amount for LTCG under Section 112A. LTCG tax free limit is ₹1,25,000 per financial year for listed equity shares and equity mutual funds (increased from ₹1,00,000 in Budget 2024). Any LTCG above this limit is taxed at 10%. There is no equivalent LTCG tax free limit under Section 112 for property, gold, or unlisted shares.
LTCG Tax on SharesLTCG tax on shares of listed companies. Governed by Section 112A. LTCG tax rate on shares: 10% above ₹1,25,000 gain per year. No indexation. Must hold for more than 12 months. STT must have been paid on purchase and sale. Grandfathering provision applies for shares bought before January 31, 2018.
LTCG Tax on PropertyTax on profit from selling immovable property held for more than 24 months. For properties purchased before July 23, 2024: choose 12.5% without indexation OR 20% with indexation. For properties purchased after July 23, 2024: 12.5% flat only. LTCG tax on sale of property must be reported in Schedule CG of your ITR.
LTCG Tax on Mutual FundEquity mutual funds: 10% above ₹1,25,000 under Section 112A after 12 months. Old debt mutual funds (pre-April 2023): 12.5% or 20% with indexation under Section 112 after 36 months. New debt mutual funds (post-April 2023): no LTCG benefit — taxed at slab rates. ELSS: 10% above ₹1,25,000 after 3-year lock-in.
LTCG and STCG Tax RateThe comparison between long-term and short-term capital gains tax rates. LTCG and STCG tax rate difference is significant: for equity, LTCG rate is 10% vs STCG rate of 20%. For property, LTCG rate is 12.5%/20% vs STCG taxed at slab rate up to 30%. The LTCG and STCG tax rate difference justifies patient, long-term investing.
Indexation for LTCGAn inflation adjustment tool available for long-term capital assets purchased before July 23, 2024. Indexation for LTCG uses the official Cost Inflation Index (CII) to increase the original purchase price, thereby reducing the taxable gain. Available for property, gold, unlisted shares, and old debt mutual funds under Section 112.
Cost Inflation Index (CII)Annual index published by CBDT under the Income Tax Act. Used to calculate indexation for LTCG. CII for FY 2024-25 = 363. CII for FY 2025-26 = 381 (estimated). Always verify the latest CII from the
official CBDT CII table.
NRI LTCG TaxLTCG tax applicable to Non-Resident Indians selling Indian assets. NRI LTCG tax rates are the same as for residents. The key difference is TDS: buyers must deduct 20% of sale price as TDS for LTCG property, 30% for STCG property. NRIs must file ITR to reconcile actual NRI LTCG tax liability and claim any refund on excess TDS.
Section 112The section of the Income Tax Act governing LTCG on all long-term capital assets except listed equity and equity mutual funds. Covers property, gold, unlisted shares, bonds, and old debt mutual funds. LTCG tax rate under Section 112: 20% with indexation OR 12.5% without indexation (choice available for assets purchased before July 23, 2024).
Section 112AGoverns LTCG on listed equity shares, equity-oriented mutual funds, and units of business trusts. LTCG tax rate: 10% on gains exceeding ₹1,25,000 per financial year. No indexation available. Requires STT payment on both purchase and sale.
Section 54 / 54EC / 54FLTCG tax exemption sections that allow you to save LTCG tax by reinvesting gains in specified assets. Section 54: sell residential property and reinvest in new residential property. Section 54EC: invest LTCG up to ₹50L in NHAI/REC bonds. Section 54F: sell any long-term asset and reinvest full sale proceeds in residential property.
LTCG LossA capital loss arising from selling a long-term capital asset at a price lower than the indexed cost of acquisition. LTCG loss can only be set off against LTCG gains (not STCG or regular income) and can be carried forward for 8 assessment years if ITR is filed on time.
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DISCLAIMER: This LTCG tax calculator and article are provided for educational and informational purposes only. They are not a substitute for professional tax advice.
ACCURACY: Results are based on FY 2025-26 LTCG tax rules as understood at the time of publishing. Individual circumstances — including special exemptions under Section 54, 54F, 54EC, DTAA treaty benefits for NRIs, LTCG loss carry-forwards, grandfathering provisions, and other provisions — can significantly change your actual LTCG tax liability.
OFFICIAL SOURCES: LTCG tax rules referenced in this article are based on the Income Tax Act, 1961 as amended by Finance Acts. Always verify current rules at the official Income Tax Department portal at
incometaxindia.gov.in.
LIABILITY: Toolisky.com assumes no liability for errors, omissions, or inaccuracies. Users are solely responsible for verifying LTCG tax results and consulting a qualified professional before making tax-related decisions.
ALWAYS CONSULT A CA: For accurate LTCG tax computation specific to your situation, consult a qualified Chartered Accountant (CA) or tax advisor. This tool cannot replace professional advice, particularly for complex transactions, multiple asset LTCG calculations, NRI-specific rules, or DTAA-related situations.
Frequently Asked Questions
What is the LTCG tax rate for FY 2025-26?
The LTCG tax rate for FY 2025-26 depends on the asset class:
- Listed equity shares and equity mutual funds (Section 112A): 10% flat on LTCG exceeding ₹1,25,000 per year — no indexation.
- Property, gold, unlisted shares, and old debt mutual funds (Section 112): For assets purchased before July 23, 2024, you choose 12.5% without indexation OR 20% with indexation — whichever gives lower LTCG tax. For assets purchased after July 23, 2024, the LTCG tax rate is 12.5% flat without indexation.
On top of the base LTCG tax, add surcharge (0% to 37% based on income) and 4% Health & Education Cess.
How do I calculate LTCG tax on shares?
To calculate LTCG tax on listed equity shares under Section 112A:
- Step 1 — Confirm the holding period is more than 12 months.
- Step 2 — Calculate LTCG = Sale Price − Purchase Price (or Fair Market Value as on January 31, 2018 if shares were bought before that date — whichever is higher).
- Step 3 — Deduct the ₹1,25,000 annual LTCG tax-free limit.
- Step 4 — Apply 10% LTCG tax on the remaining taxable LTCG.
- Step 5 — Add surcharge if total income exceeds ₹50 lakh.
- Step 6 — Add 4% cess on the combined LTCG tax plus surcharge.
An LTCG tax calculator for shares can automate these steps.
What is the LTCG tax on sale of property in India?
LTCG tax on a property sale depends on when you bought the property and how long you held it.
- Holding period: must hold the property for more than 24 months for LTCG treatment.
- Property purchased before July 23, 2024: choose between (a) 12.5% LTCG tax without indexation, or (b) 20% LTCG tax with indexation benefit using CII — whichever gives lower tax.
- Property purchased after July 23, 2024: 12.5% LTCG tax rate flat, no indexation.
Add surcharge and 4% cess to arrive at the total LTCG tax on the property sale. A capital gains tax calculator for property can give an automatic side-by-side comparison.
What is the LTCG tax-free limit for equity shares?
The LTCG tax-free limit for listed equity shares and equity mutual funds under Section 112A is ₹1,25,000 per financial year (raised from ₹1,00,000 in Budget 2024). If your total LTCG from equity in a financial year stays below ₹1,25,000, you pay zero LTCG tax; any amount above that is taxed at 10%.
There is no equivalent tax-free limit for property, gold, or unlisted shares under Section 112 — the full LTCG amount is taxable, though it remains subject to the basic income tax exemption thresholds (₹2.5L/₹3L/₹5L depending on category) if total income falls below them.
What is indexation for LTCG and how does it reduce tax?
Indexation is an inflation-adjustment tool available for long-term capital assets purchased before July 23, 2024. It uses the official Cost Inflation Index (CII) published by the CBDT to scale up your original purchase price in line with inflation between the purchase year and the sale year.
Formula: Indexed Cost = Original Cost × (CII of Sale Year ÷ CII of Purchase Year)
Example: Property bought for ₹50 lakh in FY 2014-15 (CII 240) and sold in FY 2024-25 (CII 363):
Indexed Cost = ₹50L × (363 ÷ 240) = ₹75.6 lakh
Taxable LTCG then becomes Sale Price − ₹75.6 lakh instead of Sale Price − ₹50 lakh, which meaningfully lowers the LTCG tax. This benefit is available for property, gold, unlisted shares, and old debt mutual funds under Section 112.
How does NRI LTCG tax work for property sale in India?
For NRIs selling property in India, the LTCG tax rate matches what residents pay — 12.5% or 20% with indexation for properties purchased before July 2024.
The key difference is TDS: the buyer must deduct 20% of the full sale price (not just the gain) as TDS before paying the NRI seller. This TDS is only advance tax, not the final liability — the actual NRI LTCG tax, computed on the real gain with cess and surcharge, usually works out far lower than 20% of the full sale price.
The NRI must file an Income Tax Return to reconcile the actual liability and claim a refund on any excess TDS. Many NRIs leave lakhs unclaimed simply by skipping the ITR filing. NRIs can also apply in advance for a lower TDS certificate.
What is the LTCG tax on mutual funds for FY 2025-26?
LTCG tax on mutual funds depends on the fund type:
- Equity mutual funds (>65% equity): 10% above ₹1,25,000 under Section 112A after 12 months holding — no indexation.
- ELSS funds: same treatment as equity mutual funds — 10% above ₹1,25,000 after the 3-year lock-in.
- Old debt mutual funds bought before April 1, 2023: 12.5% without indexation OR 20% with indexation under Section 112 after 36 months — whichever is lower.
- Debt mutual funds bought after April 1, 2023: no LTCG benefit — taxed at the income tax slab rate regardless of holding period.
- Hybrid funds: treatment depends on equity exposure percentage and purchase date.
What is the difference between LTCG and STCG tax rates?
The gap between LTCG and STCG rates is significant across asset classes:
- Listed equity shares: STCG at 20% (Section 111A) vs LTCG at 10% (Section 112A) — a 10 percentage point difference.
- Property: STCG taxed at the income slab rate (up to 30%) vs LTCG at 12.5% or 20% with indexation — a gap of up to 20 percentage points.
- Debt mutual funds (old, pre-2023): STCG at slab rate up to 30% vs LTCG at 12.5% or 20% with indexation — savings of roughly ₹1–3 lakh on a ₹10 lakh gain.
This gap is a strong incentive for long-term holding across every asset class.
Can I reduce LTCG tax legally in India?
Yes — some commonly used, legitimate approaches include:
- Using the ₹1,25,000 annual LTCG tax-free limit for equity by redeeming and reinvesting gains up to that threshold each year (tax harvesting).
- Comparing the indexed vs non-indexed options for pre-July 2024 assets under Section 112 and picking whichever results in lower tax.
- Reinvesting property LTCG into a new residential property under Section 54 for a full exemption.
- Investing up to ₹50 lakh of LTCG in NHAI/REC bonds under Section 54EC to claim an exemption.
- Selling a long-term asset and reinvesting the full proceeds into residential property under Section 54F.
- Timing the sale to spread gains across financial years and reduce surcharge exposure.
- Booking LTCG losses to offset against LTCG gains within the same financial year.
It's best to consult a CA before acting on these strategies.
What documents do I need for LTCG tax filing?
For LTCG tax filing, you'll typically need:
- Purchase confirmation — sale deed, broker contract note, or purchase agreement showing cost price and purchase date.
- Sale confirmation — sale deed or broker contract note showing selling price and sale date.
- For property — stamp duty and registration receipts, renovation bills (added to cost basis), and broker commission receipts.
- Official CII values from the CBDT for both the purchase year and sale year (for indexation).
- Form 26AS and Annual Information Statement (AIS) to cross-check reported transaction figures.
- For NRIs — TDS certificate (Form 16B) from the buyer.
- For pre-2018 equity — Fair Market Value confirmation as on January 31, 2018 (available from BSE/NSE).
LTCG tax filing requires ITR-2 or ITR-3 — ITR-1 cannot be used for capital gains.
What is the difference between Section 112 and Section 112A LTCG tax?
Section 112A applies to listed equity shares, equity-oriented mutual funds, and units of business trusts:
- LTCG rate: 10% on gains exceeding ₹1,25,000 per year
- No indexation benefit
- Requires STT payment
- Holding period: more than 12 months
- Surcharge capped at 15% for Section 112A LTCG
Section 112 applies to all other long-term capital assets — property, gold, unlisted shares, old debt mutual funds, and bonds:
- LTCG rate: 20% with indexation OR 12.5% without indexation (choice available for pre-July 2024 assets)
- No ₹1,25,000 annual exemption
- Holding period: more than 24 months (property, unlisted shares) or more than 36 months (gold, bonds, old debt funds)
- Full surcharge applies (up to 37%)
