Estimate tax on long-term or short-term gains from listed shares and equity mutual funds, including the 4% cess.
How to use it. Work out the gain first: sale value minus cost of acquisition and transfer expenses. For long-term gains on listed equity shares, equity mutual fund units and business trust units (held for more than 12 months, with securities transaction tax paid), section 198 of the Income-tax Act, 2025 taxes gains above ₹1,25,000 a year at 12.5%. Enter only the part above ₹1,25,000 and use 13% (12.5% plus 4% cess). For short-term gains on the same assets, section 196 charges 20%, so enter the full gain and 20.8%. Other long-term assets, such as unlisted shares, gold or property held for more than 24 months, are taxed at 12.5% without indexation under section 197.
Formula. Tax = gain × rate ÷ 100. Net = gain − tax − charges.
Worked example (illustrative). You redeem equity fund units with a long-term gain of ₹3,00,000. The taxable part is ₹3,00,000 − ₹1,25,000 = ₹1,75,000, and the tax is ₹1,75,000 × 13% = ₹22,750.
Limits. Surcharge is ignored. Set-off of losses, the basic exemption adjustment for low-income residents and grandfathering for equity bought before 1 February 2018 are not included. Debt funds bought after 1 April 2023 are taxed at slab rates, not at these rates. See the capital gains rate guide and the worked examples.
Calculations and checklists
Worked capital gains examples for 2026-27: SIP redemptions, FIFO, loss set-off, the ₹1.25 lakh exemption, gain harvesting and pre-2018 shares.
Tax rates and 2026 rules
Capital gains tax on shares, equity and debt mutual funds, gold and property for tax year 2026-27 under sections 196, 197 and 198 of the Income-tax Act, 2025.
