Capital Gains Tax

Capital gains tax in India changed more between 2023 and 2024 than in the previous decade. Debt funds lost indexation entirely. Equity short-term rates went from 15% to 20%. Property owners were handed a one-time choice that depends on a single cutoff date. Most calculators online still quote the old numbers — this one is built on the rules as they stand for FY 2026-27, which Budget 2026 left unchanged.

The tax you owe depends on three things: what you sold, how long you held it, and in some cases when you bought it. Get any one of those wrong and the number changes materially. The calculator above tells you which specific provision applied to your transaction, rather than returning a figure you have to take on faith.

The ₹1.25 lakh exemption is annual, not per transaction

This is the most commonly misunderstood part of equity taxation. The exemption applies to your total long-term equity gains across the whole financial year — not to each sale. If you booked ₹80,000 of long-term profit in June and another ₹90,000 in December, you have ₹1,70,000 of gains and only ₹1,25,000 of exemption. The remaining ₹45,000 is taxed at 12.5%.

The calculator has a field for exemption already used precisely because of this. Enter what you have already booked earlier in the year and it will apply only the balance.

Why the 1 April 2023 date matters so much for debt funds

Before that date, debt funds held over three years were taxed at 20% with indexation — meaning your purchase cost was inflated by the cost inflation index before the gain was calculated, often reducing the taxable amount to almost nothing. That benefit was withdrawn for all units purchased from 1 April 2023 onwards.

The practical result is that two investors in the identical fund can face completely different tax bills purely because of when they bought. If you hold debt fund units from both sides of that date, they are taxed separately — the calculator handles one purchase at a time, so run it once per lot.

The property choice, and when indexation actually wins

For property bought on or before 22 July 2024, you get to pick the cheaper of two calculations. Indexation tends to win when you held the property a long time through high inflation, because the indexed cost climbs substantially. The flat 12.5% tends to win when the property appreciated sharply in a short period, because there is less inflation to index away.

There is no rule of thumb that always holds — it depends on the gap between your actual gain and your indexed gain. Enter both figures above and the calculator will show you each result and apply the lower one.

Treat the output as a well-grounded estimate for planning, not a filing figure. If the amounts are large or you are claiming reinvestment exemptions, the cost of an hour with a chartered accountant is trivial against getting it wrong.