Capital Gains Tax Calculator
Calculate your tax liability on Short-Term and Long-Term Capital Gains
Capital Gains Summary
Capital Gains Calculation Breakdown
| Component | Amount (₹) |
|---|---|
| Sale Value | ₹0 |
| Cost of Acquisition | ₹0 |
| Capital Gain | ₹0 |
| Taxable Gain | ₹0 |
| Tax Rate | 0% |
| Base Tax | ₹0 |
| Cess (4%) | ₹0 |
| Total Tax | ₹0 |
When you sell a capital asset like property, equity shares, or mutual funds for a profit, the gain is subject to taxation. Calculating this Capital Gains Tax can be complex, as it depends on the asset type, holding period, and available exemptions. Our Capital Gains Tax Calculator is a comprehensive tool designed to help you accurately estimate your tax liability on both Short-Term Capital Gains (STCG) and Long-Term Capital Gains (LTCG).
This guide will walk you through how to use the calculator and explain the core principles of capital gains taxation in India, empowering you to plan your investments and taxes effectively.
Author’s Note: This calculator provides an estimate based on the data you enter and current tax laws, which are subject to change. It is intended for informational purposes only and should not be considered as legal or tax advice. For personalized advice regarding your specific financial situation, it is always recommended to consult with a qualified chartered accountant or tax professional.
What is Capital Gains Tax?
Capital Gains Tax is the tax you pay on the profit (or “capital gain”) realized from the sale of a capital asset. The tax treatment varies significantly based on how long you held the asset before selling it.
- Short-Term Capital Gains (STCG): This is the profit from selling an asset held for a short period. For listed equity shares and equity mutual funds, the holding period is 12 months or less. For assets like property or debt mutual funds, it’s 24 months or less. STCG is often taxed at a higher rate.
- Long-Term Capital Gains (LTCG): This is the profit from selling an asset held for a longer period (more than 12 months for equities, more than 24 months for property). LTCG often has a more favorable tax treatment, including lower tax rates and the benefit of indexation.
How to Use the Capital Gains Tax Calculator
Our calculator simplifies these complex rules. Follow these steps to get a clear projection:
- Select the Asset Type: Choose whether you are selling Equity/Mutual Funds, Property, or another type of asset. This is crucial as tax rules differ for each.
- Enter Purchase and Sale Details: Input the Purchase Value (what you paid for the asset) and the Sale Value (what you sold it for).
- Enter the Holding Period: Specify how long you held the asset in months. The calculator will automatically determine if the gain is short-term or long-term.
- Add Indexed Cost (for LTCG on Property): For long-term gains on property, you can enter the Indexed Cost of Acquisition to significantly reduce your taxable gain. This feature adjusts your purchase price for inflation.
- Calculate Your Tax: The tool will instantly compute your taxable capital gain and the final tax payable, including any applicable cess.
Why Plan with a Capital Gains Tax Calculator?
- Accurate Tax Calculation: Get a precise estimate of your tax liability for both STCG and LTCG, helping you plan for your tax payments in advance.
- Understand Indexation Benefits: For long-term assets like property, our calculator helps you see the powerful impact of indexation, which adjusts your purchase cost for inflation, thereby lowering your taxable profit.
- Explore Tax-Saving Opportunities: The tool can help you understand the potential for tax savings. For instance, you can explore reinvesting your long-term capital gains from a property sale into a new residential property (under Section 54) or into specified Section 54EC bonds to claim exemptions.
- Make Informed Investment Decisions: By understanding the tax implications of selling an asset, you can make more strategic decisions about when to sell and how to manage your investment portfolio.
Frequently Asked Questions (FAQs)
What is the difference between Short-Term and Long-Term Capital Gains?
The distinction is based on the holding period. For listed stocks and equity funds, if you sell after holding for more than 12 months, the profit is a Long-Term Capital Gain (LTCG). If you sell within 12 months, it’s a Short-Term Capital Gain (STCG). For property, the long-term holding period is more than 24 months.
How are capital gains on property taxed?
LTCG on property is taxed at 20% after the benefit of indexation. STCG on property is added to your total income and taxed according to your applicable income tax slab.
What is “Indexation” for Long-Term Capital Gains?
Indexation is a benefit that allows you to adjust the purchase price of an asset to account for inflation over the years you’ve held it. This increases your cost base and reduces your taxable profit. The government releases a Cost Inflation Index (CII) for each financial year to facilitate this calculation. Our calculator helps you apply this benefit.
How can I save tax on Long-Term Capital Gains?
You can save tax on LTCG by reinvesting the gains into specified assets. For example, LTCG from a property sale can be exempt if you invest it in another residential property (Section 54) or in capital gains bonds (Section 54EC).