LTCG Tax Calculator
Finance & InvestmentCalculate Long Term Capital Gains tax on equity and mutual funds for FY 2025-26. Includes 12.5% rate, ₹1.25 lakh exemption, surcharge, and cess.
🇮🇳This tool is specific to India
₹5,00,000
₹8,00,000
₹0
₹10,00,000
Total Tax Payable
₹22,750
Long Term Capital Gain
₹3.00 L
Exemption Applied (Sec 112A)
₹1.25 L
Taxable LTCG
₹1.75 L
Effective Tax Rate on Gain
7.58%
Breakdown
How the total splits
Exemption Applied (Sec 112A)
₹1.25 L
Taxable LTCG
₹1.75 L
What is a LTCG?
An LTCG Tax Calculator computes the Income Tax liability on Long Term Capital Gains from equity shares and equity-oriented mutual funds under Section 112A of the Income Tax Act. For FY 2025-26, LTCG on equity is taxed at 12.5% with an annual tax-free exemption of ₹1,25,000.
This calculator was updated to reflect the Finance Act 2024 (Budget 2024) changes effective 23 July 2024:
- LTCG rate increased from 10% to 12.5%
- Annual exemption raised from ₹1,00,000 to ₹1,25,000
The calculator handles:
- Capital gain: sale proceeds minus cost of acquisition
- Exemption: ₹1,25,000 annual limit (net of any exemption already used for other equity sales in the same financial year)
- Taxable gain: gain after exemption
- Surcharge: capped at 15% for equity LTCG (unlike regular income where it can reach 37%)
- Cess: 4% Health and Education Cess
For short-term gains (held ≤ 12 months), use the STCG Tax Calculator. For overall income tax including salary, use the Income Tax Calculator. To calculate how much you need to invest to grow your capital, use the SIP Calculator.
How to use this LTCG calculator
- Enter the Purchase Value — the original cost of acquisition including brokerage (but not STT).
- Enter the Sale Value — the total sale proceeds received.
- Enter any Exemption Already Used This Year — if you have already booked ₹50,000 of LTCG earlier in the financial year, enter that here so the calculator applies only the remaining ₹75,000 exemption.
- Enter your Annual Income (salary + other income, excluding capital gains) — this determines whether a surcharge applies.
- The result panel shows Capital Gain, Exemption Applied, Taxable LTCG, and Total Tax Payable.
- Use the step-by-step breakdown to verify the calculation before filing your ITR.
Formula & Methodology
Applicable law: Section 112A, Income Tax Act — FY 2025-26 rates (Budget 2024) | Component | Rule | |---|---| | LTCG rate | 12.5% | | Annual exemption | ₹1,25,000 | | Surcharge | 10% (income 50L–1Cr) / 15% (income >1Cr), capped at 15% | | Cess | 4% on (tax + surcharge) | Calculation steps: 1.Capital Gain = Sale Value − Purchase Value2.Exemption Applied = min(Capital Gain, ₹1,25,000 − Exemption Already Used)3.Taxable LTCG = max(0, Capital Gain − Exemption Applied)4.Base Tax = Taxable LTCG × 12.5%5.Surcharge = Base Tax × Surcharge Rate(capped at 15% for Section 112A) 6.Cess = (Base Tax + Surcharge) × 4%7.Total Tax = Base Tax + Surcharge + CessWorked example: Purchase ₹5,00,000 → Sale ₹8,00,000 → Gain ₹3,00,000; no prior exemption used; annual income ₹10 lakh. 1. Gain: ₹3,00,000 2. Exemption: ₹1,25,000 3. Taxable LTCG: ₹1,75,000 4. Base tax: ₹1,75,000 × 12.5% = ₹21,875 5. Surcharge: 0% (income below ₹50 lakh) 6. Cess: ₹21,875 × 4% = ₹875 7. Total tax: ₹22,750 Effective tax rate on ₹3,00,000 gain = 7.58%
Frequently Asked Questions
Long Term Capital Gains (LTCG) tax on equity shares and equity mutual funds is charged when you sell these assets after holding them for more than 12 months. Under Section 112A of the Income Tax Act, LTCG on equity is taxed at 12.5% (effective 23 July 2024; previously 10%) with an annual exemption of ₹1.25 lakh (previously ₹1 lakh). Gains up to this exemption limit are tax-free each financial year.
For FY 2025-26, the LTCG tax rate on equity shares and equity-oriented mutual funds under Section 112A is 12.5%. This rate was increased from 10% by the Finance Act 2024 (Budget 2024), effective 23 July 2024. The annual exemption threshold was simultaneously raised from ₹1 lakh to ₹1.25 lakh. No indexation benefit is available for equity LTCG.
Section 112A provides an annual exemption of ₹1,25,000 on LTCG from equity and equity mutual funds. This means if your total LTCG in a financial year is ₹1,25,000 or less, you pay no tax. If your gain is, say, ₹3,00,000, only ₹1,75,000 (₹3,00,000 − ₹1,25,000) is taxable. The exemption resets every financial year and applies per individual — couples filing separately each get the full exemption.
For equity shares listed on recognised stock exchanges and equity-oriented mutual funds, the holding period for LTCG classification is more than 12 months. If you hold for 12 months or less, the gain is Short Term Capital Gain (STCG) taxed at 20% under Section 111A. For unlisted equity shares and some other assets, the threshold is 24 months.
Unlike regular income tax where surcharge can reach 37% for very high incomes, the surcharge on LTCG under Section 112A is capped at 15%. This means: income ₹50 lakh to ₹1 crore = 10% surcharge; above ₹1 crore = 15% surcharge (capped). After surcharge, a 4% Health and Education Cess is applied on tax plus surcharge.
LTCG (Long Term Capital Gains) on equity applies when you hold equity shares or equity mutual funds for more than 12 months and is taxed at 12.5% with a ₹1.25 lakh annual exemption. STCG (Short Term Capital Gains) applies when the holding period is 12 months or less and is taxed at 20% with no exemption. The [STCG Tax Calculator](/stcg-tax-calculator-india/) calculates your short-term liability.
Yes — this is a common tax-planning strategy called LTCG harvesting. At the end of each financial year, you sell equity assets with unrealised gains up to ₹1.25 lakh and immediately reinvest. This resets your cost basis, making those gains permanently tax-free. However, transaction costs (STT, brokerage) must be weighed against the tax benefit. Direct plan mutual funds have lower costs and are better suited for this strategy.
No. Since April 1, 2023 (Finance Act 2023), debt mutual funds held for any period are taxed at the investor's income tax slab rate — LTCG treatment with indexation was removed. Only equity-oriented funds (minimum 65% equity allocation) qualify for Section 112A treatment. Always check the fund's equity allocation before assuming LTCG treatment applies.
Equity assets purchased on or before January 31, 2018 benefit from a grandfathering provision. The cost of acquisition for these assets is the higher of the actual purchase price or the fair market value on January 31, 2018. This prevents gains that were unrealised before LTCG was reintroduced in Budget 2018 from being taxed. This calculator uses the actual purchase price — consult a CA for grandfathered assets.
STT paid on the purchase and sale of equity shares is not deductible from LTCG for tax purposes. However, STT is a cost of the transaction and reduces your effective profit. It is not included in this calculator's computation, which focuses on the income tax liability under Section 112A.
Yes. Even if your LTCG is fully covered by the ₹1.25 lakh exemption, you must disclose capital gains in your ITR (Income Tax Return) under Schedule CG. The exemption reduces tax to zero but the gain itself must be reported. This is particularly important if you have capital loss carry-forwards to set off in future years.
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