Moment guide · FY 2026-27

I sold shares or mutual funds

What tax do I pay on my equity gains after Budget 2024?

₹1.25 lakh of eligible equity LTCG is covered under section 112A each FY, and the excess is taxed at 12.5%; listed-equity STCG under section 111A is 20%. The result depends on holding period, instrument, STT eligibility and whether losses are available for set-off or carry-forward.

The #1 trap

Old ₹1 lakh / 10% numbers are everywhere online — the law changed 23-Jul-2024 to ₹1.25L / 12.5%, and STCG to 20%.

Ravi, engineer

Ravi has eligible listed-equity LTCG of ₹3,25,000 in the FY and no capital loss. The section 112A arithmetic is total gain ₹3,25,000 minus the ₹1,25,000 FY threshold = ₹2,00,000 taxable LTCG base. Applying the 12.5% rate gives ₹2,00,000 × 12.5% = ₹25,000 before surcharge or cess. If Ravi instead sells another eligible holding at a ₹75,000 loss, the working base becomes ₹2,50,000 total net LTCG, then ₹2,50,000 minus ₹1,25,000 = ₹1,25,000, and ₹1,25,000 × 12.5% = ₹15,625 before surcharge or cess. The arithmetic saving from harvesting that loss is ₹25,000 minus ₹15,625 = ₹9,375 before those items. If the loss were short-term, it could set off STCG and LTCG. If it were long-term, it could set off only LTCG. Ravi must also check whether each instrument is actually within section 112A and whether the holding period is more than 12 months. For a separate listed-equity STCG of ₹2,00,000, the calculation is ₹2,00,000 × 20% = ₹40,000 before surcharge or cess. The ₹1.25 lakh threshold does not turn that STCG into exempt income. Ravi keeps broker statements and reports the transactions consistently. He also reconciles sale dates, purchase dates and loss categories before filing, retaining the broker’s lot-wise report. A final payable amount factors in Ravi's other income, deductions and surcharge — the calculator link below computes it end-to-end.