For land and buildings bought before 23 July 2024, it compares 12.5% without indexation with 20% with indexation and applies the lower tax, using the FY 2026-27 cost inflation index of 384.
Capital gains tax rates
Gain = Sale price − Purchase cost | Tax = Gain × rate × 1.04
- Listed equity
- Long term after 12 months: 12.5% above ₹1.25 lakh. Short term: 20%
- Property
- Long term after 24 months: 12.5%, or 20% with indexation if bought before 23 July 2024
- Gold / unlisted
- Long term after 24 months: 12.5%. Short term: your slab rate
- × 1.04
- 4% health and education cess
Indexation raises your purchase cost for inflation: indexed cost = cost × CII of the sale year ÷ CII of the purchase year. It is available only to resident individuals and HUFs selling land or buildings bought before 23 July 2024.
Debt mutual funds bought after 1 April 2023 are always taxed at your slab rate, whatever the holding period. Long-term gains can also be exempted by reinvesting in a house or specified bonds, which this calculator does not include.
Ways to legally reduce capital gains tax
Timing and reinvestment make a big difference.
- Hold equity for more than 12 months to move from 20% to 12.5%.
- Use the ₹1.25 lakh yearly LTCG exemption by booking gains every year (tax harvesting).
- Set off capital losses against gains; unused losses carry forward for 8 years.
- Reinvest long-term gains from property in a new house or specified bonds within the time limits.