What is the LTCG tax rate on equity shares in India for FY 2025-26?

Long-term capital gains on listed equity shares (held for more than 12 months) are taxed at 12.5% under Section 112A, with an annual exemption of ₹1.25 lakh per financial year. This rate was increased from 10% (with ₹1 lakh exemption) in Budget 2024. Plus 4% Health & Education Cess and surcharge if applicable (capped at 15% for capital gains).

Can I still use indexation for property LTCG after Budget 2024?

It depends on when you purchased the property. If you bought it BEFORE 23 July 2024, you can choose the lower of: 12.5% without indexation or 20% with indexation (using CII up to FY 2023-24). If you purchased on or after 23 July 2024, only 12.5% without indexation is available. This dual option is a grandfathering provision for resident individuals and HUFs.

What is Section 54 and Section 54EC exemption?

Section 54 exempts LTCG from sale of residential property if you reinvest in another residential property within 1 year before or 2 years after sale (or construct within 3 years). Section 54EC exempts LTCG from sale of any land or building if you invest up to ₹50 lakh in NHAI/REC/PFC/IRFC bonds within 6 months. Both can be claimed together. Section 54EC is only for property/land LTCG.

LTCG Calculator India — FY 2025-26

Q: How does the ₹1.25 lakh LTCG exemption work?

The ₹1.25 lakh exemption under Section 112A applies to LTCG from listed equity shares and equity-oriented mutual funds combined. It is an annual limit per financial year — if you sell multiple equity holdings, the exemption is shared across all of them. Gains up to ₹1.25 lakh are completely tax-free. Only gains above this threshold are taxed at 12.5%.

Calculate exact Long-Term Capital Gains tax on your equity shares, equity mutual funds, or property sale. Updated for Finance Act 2024: 12.5% unified LTCG rate, ₹1.25 lakh equity exemption, and property indexation choice for pre-Jul-2024 purchases. Save tax with Section 54 and 54EC exemptions.

Calculate LTCG tax on listed equity shares and equity mutual funds

Purchase value

₹

Total cost of acquisition of shares/units

Sale value

₹

Total sale consideration received

Holding period

months

Must be > 12 months for LTCG

Other equity LTCG this FY

₹

LTCG from other equity/MF sales this year (affects ₹1.25L exemption)

Surcharge tier

Based on your total income. Surcharge on CG is capped at 15%.

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How to Use This Calculator

Equity LTCG tab

Enter your purchase value, sale value, and holding period in months for listed equity shares or equity mutual funds. If you have sold other equity holdings this FY, enter those LTCG amounts to correctly account for the shared &rupee;1.25 lakh exemption. The calculator computes LTCG tax at 12.5% under Section 112A, including surcharge and 4% cess.

Property LTCG tab

Enter your property purchase and sale price, holding period, and whether you acquired the property before or after 23 July 2024. For pre-Jul-2024 purchases, the calculator compares both options — 12.5% without indexation and 20% with CII indexation — and recommends the one that results in lower tax.

Section 54/54EC Exemption tab

For property sellers. Enter your property sale details, then toggle Section 54 (reinvest in residential property) and/or Section 54EC (invest up to &rupee;50L in NHAI/REC/PFC/IRFC bonds). See exactly how much tax you save by claiming these exemptions.

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The Formula

LTCG tax in India depends on the asset type, holding period, and applicable section:

Equity Shares / Equity MF (LTCG — held > 12 months):
Tax = (Capital Gain − &rupee;1,25,000) × 12.5%
(Section 112A, exemption of &rupee;1.25 lakh per FY)

Property / Land (LTCG — held > 24 months):
Option A: Tax = Capital Gain × 12.5% (no indexation)
Option B (pre-23 Jul 2024 only): Tax = (Sale Price − Indexed Cost) × 20%
Indexed Cost = Purchase Price × (CII of FY 2023-24 / CII of purchase year)

Section 54 Exemption:
Exempt Amount = (Capital Gain × Cost of new house) / Net sale consideration

Section 54EC Exemption:
Exempt Amount = Amount invested in 54EC bonds (max &rupee;50 lakh)

Total Tax:
Total = Base Tax + Surcharge + 4% Cess
(Surcharge on capital gains capped at 15%)

Example

Priya — Equity LTCG of &rupee;3 lakh from share sale

Priya bought listed equity shares for &rupee;5 lakh and sold them for &rupee;8 lakh after holding for 18 months. She has no other equity LTCG this FY.

Step 1: Calculate capital gain

Sale value&rupee;8,00,000

Purchase value&rupee;5,00,000

Capital gain (LTCG)&rupee;3,00,000

Step 2: Apply annual exemption

LTCG exemption (Sec 112A)&rupee;1,25,000

Taxable LTCG&rupee;1,75,000

Step 3: Compute tax

LTCG rate12.5%

Base tax (&rupee;1,75,000 × 12.5%)&rupee;21,875

Health & Education Cess (4%)&rupee;875

Total LTCG tax payable&rupee;22,750

Priya pays &rupee;22,750 on a &rupee;3 lakh gain. The &rupee;1.25 lakh exemption saved her &rupee;16,250 in tax. Her effective tax rate on the entire gain is approximately 7.58%, well below the headline 12.5% rate.

FAQ

What is the LTCG tax rate on equity in FY 2025-26? ▼

Listed equity shares and equity-oriented mutual funds (held for more than 12 months) are taxed at 12.5% under Section 112A, with an annual exemption of &rupee;1,25,000 per financial year. This rate was increased from 10% (with &rupee;1 lakh exemption) in Budget 2024. Plus 4% Health & Education Cess and surcharge if applicable (surcharge is capped at 15% for capital gains income). The maximum effective LTCG rate is approximately 14.95%.

Can I use indexation for property LTCG after Budget 2024? ▼

It depends on when you purchased the property. If you bought it before 23 July 2024, you can choose the lower of: 12.5% without indexation or 20% with indexation (using Cost Inflation Index up to FY 2023-24). If you purchased on or after 23 July 2024, only 12.5% without indexation is available. This dual-option grandfathering provision applies to resident individuals and HUFs only. The calculator in the "Property LTCG" tab automatically compares both options and recommends the better one.

How does the &rupee;1.25 lakh LTCG exemption work? ▼

The &rupee;1.25 lakh exemption under Section 112A applies to LTCG from listed equity shares and equity-oriented mutual funds combined. It is an annual limit per financial year — if you sell multiple equity holdings, the exemption is shared across all of them. Only gains above this threshold are taxed at 12.5%. This exemption does not apply to property, gold, or debt mutual fund LTCG. The "Equity LTCG" tab lets you enter other equity LTCG this FY to correctly split the exemption.

What is the difference between Section 54 and Section 54EC? ▼

Section 54 exempts LTCG from sale of a residential property if you reinvest in another residential property — purchase within 1 year before or 2 years after sale, or construct within 3 years. The exemption is proportionate to the reinvestment. If LTCG ≤ &rupee;2 crore, you can invest in 2 houses (once-in-lifetime benefit). Section 54EC exempts LTCG from sale of any land or building if you invest up to &rupee;50 lakh in NHAI/REC/PFC/IRFC bonds within 6 months. These bonds have a 5-year lock-in and pay about 5–5.25% interest (taxable at slab). Both sections can be claimed together.

What is grandfathering for equity LTCG? ▼

For listed equity shares and equity mutual funds held since before 31 January 2018, gains accrued up to that date are exempt from LTCG tax. Only gains after 31 January 2018 are taxable. The fair market value (FMV) on 31 Jan 2018 is used as the deemed cost of acquisition, subject to a cap at the actual sale price. This provision was introduced in Budget 2018 when equity LTCG was reintroduced after a long exemption period. If you hold pre-2018 equities, consult a CA to compute the grandfathered cost correctly.

Did Budget 2025 change any LTCG rates? ▼

No. The Union Budget 2025 (Finance Act 2025) did not change any capital gains tax rates. The 12.5% LTCG rate for equity (Sec 112A) and property (Sec 112), the &rupee;1.25 lakh annual exemption, the 20% STCG rate for equity (Sec 111A), and the property indexation grandfathering option all remain unchanged for FY 2025-26. All rates used in this calculator are current as of March 2026.

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