How to Use the Capital Gains Tax Calculator
Pick the asset type. For equity, enter your total purchase value, sale value and holding period — the calculator classifies the gain as short- or long-term, applies the ₹1.25 lakh LTCG exemption, and shows tax with cess. For property, enter prices and the purchase/sale financial years: the calculator computes the indexed cost from the CBDT CII table, evaluates both the 20%-indexed and 12.5%-flat routes where you have the choice, and applies the cheaper one.
Capital Gains Tax Calculator Formula
Equity LTCG tax = (gain − 1,25,000) × 12.5%; Property: min(20% × indexed gain, 12.5% × gain)indexed gain= Sale price − purchase price × (CII_sale ÷ CII_purchase)₹1.25L= Annual LTCG exemption for equity (s.112A)cess= 4% health & education cess on the tax
Example Calculation
Sold equity mutual funds for ₹8L that were bought for ₹5L three years ago:
Gain ₹3L − ₹1.25L exemption = ₹1.75L taxable × 12.5% = ₹21,875 + 4% cess
Total tax = ₹22,750 — net proceeds ₹7,77,250
The 2024 reset: simpler rates, one big choice
The Finance (No. 2) Act 2024 flattened India’s capital gains landscape: long-term gains on most assets now face a single 12.5% rate without indexation, equity STCG rose to 20%, and the equity LTCG exemption widened to ₹1.25 lakh. For share and mutual-fund investors the regime is now genuinely simple — the only planning lever left is the annual exemption.
Property sellers kept one crucial grandfather clause: if you acquired the property before 23 July 2024, you may still compute tax the old way — 20% on the indexed gain — and pay whichever of the two routes is lower. On older properties bought cheap, the flat 12.5% usually wins; on recent purchases where inflation ate most of the paper gain, indexation often still saves lakhs. Never guess: this calculator runs both.
Equity: use the exemption every year
The ₹1.25 lakh LTCG exemption is a use-it-or-lose-it annual allowance. An investor sitting on large equity gains can sell just enough each March to realise ₹1.25 lakh of long-term gain, pay nothing, and immediately repurchase — stepping up the cost base and permanently sheltering that slice from the 12.5% rate. Over a decade this "gain harvesting" quietly saves ₹15,000+ a year for a disciplined investor. Watch two traps: gains within 12 months are short-term at 20%, and the exemption is shared across all your equity sales in the year.
Property: the sequencing that matters
- Confirm the holding period first — crossing 24 months converts slab-rate STCG into 12.5% LTCG, a difference that can dwarf every other decision.
- For pre-23-Jul-2024 purchases, compute both routes (this tool does) — the wrong default can overpay by lakhs.
- Planning to reinvest? s.54 (sell house, buy house) or s.54F (sell any asset, buy house) can wipe the liability if timelines are met — engage a CA before, not after, the sale deed.
- The buyer must deduct 1% TDS on properties above ₹50L (s.194-IA) — reconcile it in your return against the actual liability.
Frequently Asked Questions
What are the current capital gains tax rates on shares?
For listed equity and equity mutual funds (STT paid): short-term gains (held 12 months or less) are taxed at 20%; long-term gains at 12.5% on the amount exceeding ₹1.25 lakh per financial year. Both attract 4% cess.
How is property capital gains tax calculated now?
Property held over 24 months is long-term. The default rate is 12.5% without indexation. If you acquired the property before 23 July 2024, you can instead pay 20% on the indexation-adjusted gain — whichever is lower. Short-term property gains are added to your income and taxed at slab.
What is indexation and when does it still help?
Indexation inflates your purchase cost by the CBDT Cost Inflation Index, so only above-inflation gains are taxed. It helps when the property has appreciated modestly — roughly, when the price has less than tripled over a long holding. This calculator computes both routes and picks the cheaper automatically.
Can I avoid capital gains tax on a property sale?
Sections 54 and 54F exempt long-term gains reinvested in a residential house within specified timelines (or ₹50L/year in 54EC bonds). These reliefs are not modelled here — the calculator shows your pre-exemption liability; consult a CA before the sale to structure reinvestment.
Is the ₹1.25 lakh exemption per transaction?
No — per financial year, across all your equity LTCG. Harvesting gains up to ₹1.25L each year and re-buying resets your cost base tax-free; the calculator shows how much of the exemption a sale uses.
How are debt mutual funds taxed?
Debt funds bought after 1 April 2023 are taxed at your slab regardless of holding period — no LTCG rate, no indexation. Use the equity tab only for equity-oriented funds.
Assumptions & Methodology
- Equity: listed shares / equity mutual funds with STT paid — STCG 20% (≤12 months), LTCG 12.5% above the ₹1.25 lakh annual exemption.
- Property: LTCG if held over 24 months. Transfers taxed at 12.5% without indexation; for property acquired before 23 July 2024, the calculator automatically compares the 20%-with-indexation option and applies the cheaper one (resident individuals/HUF).
- CII values are the CBDT-notified series (base 2001-02 = 100) through FY 2025-26.
- 4% health & education cess is included; surcharge, exemptions under s.54/54F, and brought-forward losses are not modelled.
Sources
All calculations run in your browser and are provided for information only — they are not investment, tax or legal advice. Verify current rates and rules with the official source above before acting.