How a gain is taxed in India depends on what you sold and how long you held it. Since July 2024 most long-term gains are taxed at 12.5% without indexation, and Budget 2026 left the rates as they were for 2026-27.
Here are the rates for each kind of investment and three worked examples.
Capital gains rates for 2026-27
| Investment | Long-term after | Long-term rate | Short-term rate |
|---|---|---|---|
| Listed shares, equity mutual funds | 12 months | 12.5% above ₹1.25 lakh a year | 20% |
| Gold ETFs, gold funds, listed bonds | 12 months | 12.5% | Slab rate |
| Property and land | 24 months | 12.5% | Slab rate |
| Unlisted shares, physical gold | 24 months | 12.5% | Slab rate |
| Debt funds bought from April 2023 | Never | Slab rate | Slab rate |
Worked examples
Example: Equity funds held 18 months: ₹5 lakh to ₹8 lakh
Gain ₹3,00,000, less the ₹1,25,000 exemption: ₹1,75,000 taxed at 12.5% = ₹21,875.
With 4% cess: ₹22,750. Sold within 12 months, the same gain would cost ₹62,400 at 20%.
Example: Debt fund gain of ₹1 lakh, ₹15 lakh income
The gain is added to your income and taxed at your 15% slab: ₹15,600 with cess, however long you held it.
Example: Low income: ₹3 lakh short-term equity gain, ₹2 lakh other income
The unused ₹2 lakh of the ₹4 lakh basic exemption is set against the gain, so ₹1 lakh is taxed at 20%.
Tax: ₹20,800. The ₹12 lakh rebate in the new regime doesn't apply to gains taxed at special rates.
To see how an investment grows before you sell, use the SIP calculator.
Ways to pay less, legally
- Hold equity past 12 months to move from 20% to 12.5%.
- Use the ₹1.25 lakh exemption every year by booking long-term equity gains up to that amount, then reinvesting.
- Set off losses. Short-term losses reduce any gain; long-term losses only long-term gains. Unused losses carry forward 8 years if you file on time.
- Property: reinvesting the gain in another home or specified bonds can exempt it, subject to limits.
How to use this calculator
- Choose what you sold.
- Enter the buying and selling price, costs and months held.
- Enter your other taxable income and regime.
- For shares and equity funds, add any long-term gains you've already booked this year.
FAQs
What are the capital gains tax rates for 2026-27?
Listed equity and equity funds: 20% short term and 12.5% long term above ₹1.25 lakh. Most other long-term gains: 12.5% without indexation. Budget 2026 didn't change these.
Is the ₹1.25 lakh exemption per sale?
No. It's for all your long-term gains on listed equity and equity funds in the tax year combined.
How are debt mutual funds taxed?
Units bought from 1 April 2023 are taxed at your slab rate however long you hold them.
Does the ₹12 lakh tax-free limit cover capital gains?
Not gains taxed at special rates. In the new regime the rebate can't be used against 20% or 12.5% gains, so these are taxed even if your other income is low.
Can I set off a loss?
Yes. Short-term losses can be set against any capital gain; long-term losses only against long-term gains. Unused losses carry forward for 8 years if you file on time.
Sources
- Business Standard: Budget 2026 leaves LTCG tax rates unchanged for FY27
- Tata Mutual Fund: Post-Budget 2026 tax map for equity investors
Results are estimates for resident individuals under 60 and aren't tax, legal or financial advice. For your own return, check with a chartered accountant. Spotted a mistake? Tell us.