Capital Gains Tax — Shares, Mutual Funds and Property
Quick answer: Gains on listed equity shares and equity mutual funds held for more than 12 months are long-term and taxed at 12.5% without indexation, after a ₹1.25 lakh yearly exemption under Section 112A. Shorter holdings are short-term and taxed at 20%. For property, long-term means more than 24 months, taxed at 12.5% without indexation, with a 20% option with indexation for property bought before 23 July 2024.
Last verified 26 October 2026 against published GST rules summaries. Confirm against the official GST notification list before any filing; we re-check it before each filing cycle.
Rates and holding periods
| Asset | Short-term if held | Long-term if held | Tax rate |
|---|---|---|---|
| Listed equity shares and equity mutual funds (STT paid) | Up to 12 months | More than 12 months | Short-term 20%. Long-term 12.5% without indexation, above a ₹1.25 lakh exemption per year (Section 112A) |
| Immovable property (land and buildings) | Up to 24 months | More than 24 months | Long-term 12.5% without indexation. For property bought before 23 July 2024, 20% with indexation if it gives lower tax |
Key rules
- The ₹1.25 lakh exemption under Section 112A applies per financial year, to long-term gains on listed equity shares and equity-oriented funds.
- Long-term gains on other assets fall under Section 112.
- Reinvestment exemptions under Sections 54 and 54F can reduce tax on property and other assets, subject to conditions and time limits.
- Capital gains are reported in the ITR for the year of sale, along with the purchase cost, sale value and holding period for each transaction.
Budget 2026
One secondary source reports that Budget 2026 kept the 12.5% equity LTCG rate, the ₹1.25 lakh exemption and the 20% STCG rate unchanged for FY 2026-27. Confirm this against the official Finance Act 2026 text before you file, since the source does not cite the Act.
What we do
- Transaction-wise capital gains computation with purchase cost, holding period and indexation where it applies
- Section 112A exemption use across the year
- Reinvestment planning under Sections 54 and 54F, where eligible
Related: Form 16 and Form 16A TDS certificates.
Talk to us before you file anything
Frequently asked questions
What is the long-term capital gains rate on shares?
12.5% without indexation on gains above the ₹1.25 lakh yearly exemption under Section 112A, for listed equity shares and equity mutual funds held more than 12 months.
What is the short-term capital gains rate on shares?
20%, for shares and equity mutual funds held for 12 months or less.
What is the holding period for property?
More than 24 months for long-term treatment. Up to 24 months is short-term.
Is there an exemption on property gains?
There is no yearly exemption for property. Sections 54 and 54F may allow exemption if you reinvest, subject to conditions and time limits.
Did Budget 2026 change capital gains tax?
One secondary source says the structure is unchanged for FY 2026-27. Confirm against the official Finance Act 2026 text before filing.