Selling shares for ₹8 lakh that cost ₹5 lakh after 2 years 7 months gives a ₹3 lakh long-term gain and ₹22,750 of tax. That is 12.5% on the ₹1.75 lakh above the ₹1.25 lakh exemption, plus 4% cess.
What this calculates
Choose the asset, enter the buy and sell dates and prices, and this works out the holding period, whether the gain is short term, long term or taxed at your slab rate, the exemption, the rate and the tax with cess, with a table showing each line. The rates are those of FY 2026-27 from the Income Tax Department, and are reviewed every Budget.
The formula
Gain
capital gain = sale price − purchase priceTax
tax = (gain − exemption) × rate; total = tax + 4% cessA gain is long term if the sale is more than 12 months (shares, equity funds) or 24 months (property, gold) after the purchase. Shares and equity funds pay 20% short term and 12.5% long term above ₹1.25 lakh; property and gold pay the slab rate short term and 12.5% long term; debt funds pay the slab rate.
Worked example
Sold after 6 months, a ₹40,000 gain on shares pays 20% = ₹8,000, ₹8,320 with cess. Property held 6 years 5 months with a ₹30 lakh gain pays ₹3,90,000. Sold exactly 12 months after buying, a ₹1 lakh gain on shares is still short term: ₹20,800.
When to use it, and the mistakes to avoid
Use it to plan when to sell, to see what a sale will cost in tax, or to compare holding a few more days for long-term treatment.
The mistakes that cost the most:
- Selling a day too early. The holding period must be exceeded, not just reached.
- Forgetting that the exemption is yearly. The ₹1.25 lakh covers all your equity gains in the year.
- Using the wrong slab rate. For property, gold and debt funds the tax depends on your own rate.
- Ignoring other costs. Brokerage, stamp duty and improvement costs change the gain.
- Treating this as a filing. Surcharge and loss set-off are not modelled.
FAQ
What are the capital gains tax rates in India for FY 2026-27?
For listed shares and equity mutual funds: 20% on short-term gains (held 12 months or less) and 12.5% on long-term gains above ₹1.25 lakh a year. For property and gold: the slab rate on short-term gains (held 24 months or less) and 12.5% on long-term gains, without indexation. Debt mutual funds bought after 1 April 2023 are taxed at your slab rate. Cess of 4% is added to the tax.
When is a gain long term?
Only if you held the asset for MORE than the holding period: over 12 months for listed shares and equity funds, over 24 months for property and gold. Selling exactly 12 months after buying is still short term; a day later is long term. The calculator counts calendar months.
How does the ₹1.25 lakh exemption work?
The first ₹1.25 lakh of long-term gains on shares and equity mutual funds in a financial year is exempt; only the rest is taxed at 12.5%. It is a yearly limit across all your equity sales, which this calculator treats sale by sale, so it does not know about your other gains.
Can I save tax on a property gain?
A long-term gain on property can be exempted by reinvesting it in another house or in specified bonds, within the time and limits the law sets (sections 54 and 54EC in the 1961 Act). Enter the amount you reinvest and the calculator takes it off, up to the gain. Property bought before 23 July 2024 may also be taxed at 20% with indexation if that is lower, which is not modelled here.
What is not included?
Surcharge, securities transaction tax, brokerage and other costs of sale, the set-off or carry-forward of losses, and special cases such as inherited assets and the older 20%-with-indexation option. For a filing, check the current rules on the Income Tax Department's website or with a tax adviser.