Free Tool

Capital Gains Tax Calculator

Enter a buy value, a sell value and the dates, pick the instrument, and the tool identifies the tax head and computes the tax at FY 2025-26 rates: short-term capital gain at 20 percent under section 111A, long-term at 12.5 percent above the 1,25,000 rupee exemption under section 112A, or F&O and intraday profit as business income at your slab rate, each with 4 percent cess. Switch the instrument on the same rupee gain and watch the tax change.

The instrument decides the tax head. The same profit is a 12.5 percent long-term gain, a 20 percent short-term gain, or slab-rate business income, depending only on what you traded and how long you held it.

Educational, not tax advice This calculator is an educational aid. It computes an illustrative figure from the inputs you enter at representative current rates; it is not tax advice and not a filing. Tax outcomes depend on your full income, prior-year losses, regime and surcharge position, which this tool does not model. Consult a qualified CA or tax professional before you file or act on any number here.

Preset cases

Load

The position

Instrument class Listed equity or equity mutual fund held and delivered. Capital gains: the holding period decides short-term versus long-term.

Buy price (per share)

Sell price (per share)

Quantity (shares) Number of shares bought and sold. Gain is (sell price minus buy price) times quantity.

Holding period (delivery)

Buy date

Sell date More than 12 months held is long-term (112A, 12.5%); 12 months or less is short-term (111A, 20%).

Year and slab

Financial year The 20% and 12.5% rates apply to transfers on or after 23 July 2024. Earlier transfers used 15% and 10%, not modelled here.

Your marginal slab rate Used for F&O and intraday, which are business income taxed at your slab. Also shown in the comparison so you can see the marginal impact.

Tax head

Gain (before tax)

Tax payable (with cess)

Net after tax

The one thing this tool teaches

The same gain, taxed under all three heads. Only the instrument and holding period decide which one you actually pay.

As short-term capital gain (111A)

20% flat

As long-term capital gain (112A)

12.5% above ₹1,25,000

As business income (F&O / intraday)

at your slab

Same gain, three taxes

Each bar is the tax, including 4 percent cess, on this exact gain under one head. The highlighted bar is the head your inputs actually fall under.

How the tax is built

Total tax (with cess)

Read before you use this figure

This tool prices the tax on one outcome after the fact. The decision that actually moves your post-tax return is upstream: which instrument you trade, and therefore which head your profit is taxed under, is chosen before the trade, not at filing. A long-term equity gain at 12.5 percent and an F&O gain at a 30 percent slab are the same skill producing very different take-home. Building the process so the after-tax number, not the gross tick, is the target is what the method we teach is built around.

Take the free diagnostic Read the full tax guide

The one principle

In Indian tax law the profit does not decide the tax, the instrument does. Deliver a listed share held over a year and the gain is taxed at 12.5 percent under section 112A, above a 1,25,000 rupee yearly exemption. Sell it inside a year and the same gain is a flat 20 percent under section 111A. Make the identical profit in F&O and it is not a capital gain at all: it is non-speculative business income taxed at your slab rate, which for many traders is 30 percent plus cess. One rupee of profit, three tax heads, and the retail error that costs the most is filing F&O as capital gains when it is business income.

Post-tax return is the only return that matters, and it is decided partly by a choice made before the trade. The SEBI FY25 study found that over 91 percent of individual traders in the equity derivatives segment were net loss-making, with aggregate net losses near 1,05,603 crore rupees, up roughly 41 percent on the prior year. For that overwhelming majority the tax question is not how much tax is due on a gain, it is whether the loss was declared in a return filed on time so it can be set off and carried forward. A calculator that only prices gains is answering the smaller question; the larger one, for most F&O participants, is the treatment of the loss.

The tax, derived by head

Every case reduces to the same five steps: find the gain, fix the head, apply the rate, apply the exemption where one exists, and add cess. What changes between instruments is the head and the rate, and for long-term equity, the 1,25,000 rupee annual exemption that comes off before the rate applies.

THE COMPUTATION, PER HEAD
gain = sell value − buy value
head = f(instrument, holding) delivery ≤12m: STCG 111A; delivery >12m: LTCG 112A; intraday: speculative; F&O: non-speculative

STCG (111A) → tax = gain × 20%
LTCG (112A) → tax = max(0, gain − 1,25,000) × 12.5% exemption is per financial year, in aggregate
business → tax = gain × slab rate F&O or intraday, added to total income

cess = 4% × tax health and education cess
total tax = tax + cess
net after tax = gain − total tax

The exemption is a threshold, not a deduction. The 1,25,000 rupees of long-term equity gain that escapes tax is an annual aggregate across every long-term equity sale you make in the year, not a per-trade allowance. It is applied once, to the total, before the 12.5 percent rate. It does not reduce short-term gains, and it does not apply to F&O or intraday income, which are business income with no such threshold.

Worked on the default long-term case: 100 shares bought at 2,000 and sold at 5,000 is a buy value of 2,00,000, a sell value of 5,00,000 and a gain of 3,00,000, held about eighteen months, so long-term under 112A. The exemption takes the taxable base to 3,00,000 minus 1,25,000, which is 1,75,000. At 12.5 percent that is 21,875, and 4 percent cess of 875 brings the total to 22,750, leaving 2,77,250 net. Change nothing but the instrument to F&O at a 30 percent slab and the same 3,00,000 gain is taxed at 30 percent, that is 90,000, plus 3,600 cess, a total of 93,600, leaving 2,06,400. The tool reproduces both figures line by line.

The instrument decides the head

The fork at the top is the whole game. A capital-gains head unlocks the concessional 12.5 percent and 20 percent rates and, for long-term, the annual exemption. A business-income head does not: F&O and intraday are taxed at your slab, with no exemption and no concessional rate, and the trade-off is that their expenses are deductible and their losses have set-off rules a capital gain does not. Choosing the instrument is choosing the branch.

Reference: tax head by instrument and holding period

The definitive map of how each activity is classified and taxed for FY 2025-26, for listed equity on which securities transaction tax is paid. Read it as the rule the calculator applies before it ever reaches a rate.

Classification and rate by activity, listed equity, FY 2025-26 (AY 2026-27). Illustrative summary of the current position; verify against the Income-tax Act and a qualified CA for your case.
Activity	Head	Section	Rate (before cess)	ITR form
Delivery, held > 12 months	Long-term capital gain	112A	12.5% above ₹1,25,000	ITR-2 or ITR-3
Delivery, held ≤ 12 months	Short-term capital gain	111A	20% flat	ITR-2 or ITR-3
Intraday equity	Speculative business	43(5)	Slab rate	ITR-3
Equity / index F&O	Non-speculative business	43(5)	Slab rate	ITR-3

The holding-period line is a hard edge. For listed equity, more than twelve months is long-term and twelve months or less is short-term. A sale a few days either side of the anniversary changes the section, the rate, and whether the annual exemption is available. There is nothing gradual about it, so on a large position the exact trade date matters to the tax.

Reference: the STCG and LTCG rate card, before and after Budget 2024

The Finance Act 2024 raised both equity capital-gains rates and the long-term exemption for transfers on or after 23 July 2024. Gains booked in FY 2025-26 use the new column. A tool or a memory still on the old rates understates the tax.

Listed-equity capital-gains rates, on STT-paid shares and equity funds. The right column is what applies to FY 2025-26. Illustrative; a 4 percent health and education cess applies on the tax in every case.
Item	Until 22 Jul 2024	From 23 Jul 2024 (FY 2025-26)
STCG rate (111A)	15%	20%
LTCG rate (112A)	10%	12.5%
LTCG annual exemption	₹1,00,000	₹1,25,000
Indexation on equity LTCG	None	None
Long-term holding period	> 12 months	> 12 months
Effective rate with 4% cess	STCG 15.6%, LTCG 10.4%	STCG 20.8%, LTCG 13%

Section 87A does not rescue these. Capital gains taxed at the special rates under 111A and 112A are excluded from the section 87A rebate, so even an investor whose ordinary income is below the rebate threshold can owe short-term or long-term capital-gains tax. Surcharge, where a very high total income triggers it, is capped at 15 percent for gains under 111A and 112A, lower than the surcharge that can apply to other income. Neither surcharge nor rebate is modelled here.

The 1.25 lakh exemption is one bucket, not one per trade

A common and costly misread is to claim the exemption on every sale. The 1,25,000 rupees is a single annual threshold across all your long-term equity gains combined. Three sales totalling 3,00,000 do not each get 1,25,000 free; the whole 3,00,000 shares one exemption, and 1,75,000 is taxed. Modelling it per trade understates the tax and can produce a filing that does not match the department's own aggregation.

Reference: the same gain, three heads, at each slab

A single 3,00,000 rupee profit, priced under every head and slab, cess included. This is the calculator's central lesson in one table: the profit is constant, the tax is not, and the gap between the cheapest and dearest treatment is larger than most retail traders assume.

Tax on a 3,00,000 rupee gain by head, including 4 percent cess, FY 2025-26. Long-term applies the 1,25,000 exemption first. Illustrative arithmetic on the base rate and cess only; surcharge, rebate and your other income are not modelled.
Treatment	Taxable base	Rate	Tax with cess	Net kept
Long-term capital gain (112A)	₹1,75,000	12.5%	₹22,750	₹2,77,250
Short-term capital gain (111A)	₹3,00,000	20%	₹62,400	₹2,37,600
Business income at 20% slab	₹3,00,000	20%	₹62,400	₹2,37,600
Business income at 30% slab	₹3,00,000	30%	₹93,600	₹2,06,400

The spread is the point. The same 3,00,000 gain costs 22,750 in tax as a long-term equity holding and 93,600 as F&O business income at a 30 percent slab, a difference of over 70,000 rupees on identical profit. This is not a loophole to chase; the instruments carry different risk and different loss treatment. It is the reason the tax head belongs in the plan before the trade, not discovered at filing.

Losses are ring-fenced differently by head

For most F&O traders this diagram, not the gains rate, is the tax page that matters. With over 91 percent of individual derivatives traders net loss-making in the SEBI FY25 data, the practical question is which future income a loss can shelter and for how long, and the answer differs sharply across the three heads. The non-speculative F&O treatment is the most generous, but only if the loss is declared in a return filed by the due date; miss the date and the carry-forward is gone.

Reference: audit and presumptive thresholds for F&O

F&O is business income, so it can attract a tax audit or use the presumptive scheme. Turnover here is not notional contract value; it is the absolute value of profits and losses, with option sell premium added, which keeps it far below the notional you traded. These provisions are technical and drift, so read this as orientation, not a filing rule.

Business-income thresholds relevant to F&O, FY 2025-26. Illustrative summary; confirm your position with a qualified CA. Thresholds and rules change with each Finance Act.
Provision	What it says, in outline
Turnover (F&O)	Absolute sum of profits and losses, plus premium on option sells. Not the notional value of the contracts.
Tax audit, section 44AB	Broadly applies where turnover exceeds ₹10 crore, since almost all trading is digital. Can also apply if presumptive profit is under-declared and total income exceeds the basic exemption.
Presumptive, section 44AD	Available up to ₹3 crore turnover where receipts are almost entirely digital, by declaring at least 6 percent of turnover as profit; 8 percent where receipts are not digital.
Return form	ITR-3 for any F&O or intraday activity, even a loss year, so the loss can be declared and carried forward.

Do not over-read the thresholds. Whether a specific trader must audit, and whether the presumptive scheme is available and advisable for their mix of activity, turns on details this summary deliberately does not resolve, including prior use of the scheme and the interaction with other income. The figures here are current as of July 2026 and are here to orient the question, not to answer it for your return. That is a conversation for a qualified CA.

Failure modes: where the clean number still breaks

The arithmetic is exact for the inputs you give it. What breaks is the assumption that a single trade's tax, at the base rate, is your actual tax bill. Six conditions detach this figure from what your return will finally show.

1. This prices one position, not your year. Your real tax is computed on aggregates: total long-term gains against the single annual exemption, total business income against your slab, gains net of eligible losses. A per-trade figure cannot see the other trades, the prior-year carried-forward losses, or your salary and other income that set your slab. Treat this as the tax on one outcome in isolation, not a return.

2. Set-off and carry-forward change everything on a losing year. If you have current or brought-forward losses, the taxable gain can be far lower than the gross gain shown here, or nil. The tool does not net losses. For the majority of F&O traders, who are net loss-making, the live question is the set-off and carry-forward treatment, covered above, not a tax on a gain.

3. Surcharge and the 87A rebate are not modelled. On high total income a surcharge applies, capped at 15 percent for 111A and 112A gains. At the other end, the section 87A rebate can zero ordinary slab tax but never the special-rate capital-gains tax. Both depend on your full income, so this tool computes only the base rate plus 4 percent cess.

4. Grandfathering of pre-1-February-2018 holdings. For listed equity acquired before 1 February 2018, long-term gains are protected by a grandfathering rule that substitutes a stepped-up cost based on the highest price up to 31 January 2018. If your holding predates that date, the true taxable gain is smaller than sell minus actual cost, and this tool does not apply the grandfathering adjustment.

5. The exemption is annual and aggregate, and shared. The 1,25,000 long-term exemption is used once across all your long-term equity sales in the year. If earlier sales this year have already consumed part of it, less is left for this one, and the tool, seeing a single position, assumes the full exemption is available. On your return it is netted across everything.

6. Rates and rules change, and only listed STT-paid equity is modelled. These rates apply to listed equity and equity-oriented funds on which securities transaction tax is paid, for transfers on or after 23 July 2024. Unlisted shares, debt, gold, property, and foreign assets follow different heads and rates entirely. Advance-tax timing, which requires paying as gains arise, is also not modelled. Verify the current provisions before you rely on any figure.

The honest summary. This tool applies the correct head and base rate to one position at July 2026 rates, and shows the striking difference the instrument makes. It does not compute your return, net your losses, apply surcharge, rebate or grandfathering, or know your other income. Use it to understand which head applies and what that costs at the margin, and take the actual filing to a qualified CA.

The risk-manager's view: the tax head is a decision, not a footnote

Cost and tax are the two parts of a trading outcome you can know before you act. The move is uncertain, but the tax head is fixed the moment you choose the instrument and the holding period. A desk treats that as a decision variable: an identical thesis expressed as a long-held equity position and as an F&O position produce the same gross tick and very different take-home, 12.5 percent against a slab rate, and that gap belongs in the plan, not in a surprise at filing.

This is also where the SEBI FY25 base rate reframes the whole topic. With over 91 percent of individual derivatives traders net loss-making, aggregate net losses near 1,05,603 crore rupees and up roughly 41 percent on the prior year, the typical F&O trader's tax event is not a gain to be taxed but a loss to be preserved. The single highest-value tax action for that trader is unglamorous: file ITR-3 on time, in a loss year, so the non-speculative loss carries forward for eight years. The gains rate is the question for the minority who won; the set-off rule is the question for almost everyone. Both start from the same fact, which is that the instrument, chosen before the trade, decides the tax.

Common Questions

Frequently Asked Questions

How is capital gains tax on shares calculated in India for FY 2025-26?

For listed equity shares and equity mutual funds on which securities transaction tax is paid, the tax depends entirely on how long you held the position. Held for twelve months or less, the gain is a short-term capital gain under section 111A, taxed at a flat 20 percent. Held for more than twelve months, it is a long-term capital gain under section 112A, taxed at 12.5 percent on the part of your total long-term gains above 1,25,000 rupees in the financial year, with no indexation. A health and education cess of 4 percent is added to the tax in both cases. So the calculation is: find the gain, fix the head by holding period, apply the rate, apply the annual exemption for long-term, then add cess. This tool applies exactly that sequence to the buy value, sell value and dates you enter, and every output is illustrative, not tax advice.

What is the tax on F&O trading in India?

Profit from futures and options is not a capital gain at all. It is non-speculative business income under section 43(5), so it is added to your total income and taxed at your slab rate, the same rate that applies to salary or business profit, plus the 4 percent cess. There is no 12.5 percent or 20 percent concessional rate for F&O. A trader on the 30 percent slab pays 30 percent plus cess on F&O profit, far more than the 12.5 percent a long-term equity investor pays on the same rupee gain. Because it is business income, related expenses such as brokerage and securities transaction tax are deductible, losses have their own set-off rules, and a tax audit can apply above the turnover thresholds. F&O income is filed on ITR-3, the business-income return.

Is F&O income capital gains or business income?

Business income, and treating it as capital gains is one of the most common and expensive filing errors retail traders make. Futures and options are classified as non-speculative business income under section 43(5) of the Income-tax Act, so the profit is taxed at your slab rate, not at the 12.5 percent long-term or 20 percent short-term capital-gains rate. The instrument decides the head: the same 3,00,000 rupee profit is taxed very differently as a long-term capital gain, as a short-term capital gain, or as F&O business income at a 30 percent slab. Filing F&O under capital gains misstates the tax, uses the wrong return form, and can invite a notice. The correct form for any F&O activity is ITR-3, and this is the single distinction this calculator is built to make visible.

What is the STCG tax rate on shares now?

Short-term capital gains on listed equity shares and equity mutual funds where securities transaction tax is paid are taxed at a flat 20 percent under section 111A, plus the 4 percent health and education cess, which makes the effective rate 20.8 percent before any surcharge. The 20 percent rate was raised from the earlier 15 percent for transfers made on or after 23 July 2024, so gains booked in FY 2025-26 use 20 percent. It applies to delivery equity held for twelve months or less, and it applies regardless of your income slab: a person otherwise in a lower slab still pays 20 percent on this gain, and the section 87A rebate does not reduce it. Short-term here means the holding period, not the intent of the trade.

What is the LTCG tax on shares, and how does the 1.25 lakh exemption work?

Long-term capital gains on listed equity and equity mutual funds, meaning positions held for more than twelve months with securities transaction tax paid, are taxed at 12.5 percent under section 112A, plus the 4 percent cess, with no indexation. The first 1,25,000 rupees of long-term gains in a financial year are exempt, and only the excess is taxed. The exemption was raised from the earlier 1,00,000 rupees, and the rate from 10 percent, for transfers on or after 23 July 2024. The single most misunderstood point: the 1,25,000 exemption is a per-year aggregate across all your long-term equity gains, not a per-trade or per-scrip allowance. If several sales in the year together produce 3,00,000 rupees of long-term gain, only 1,75,000 is taxed, once, not each sale separately.

How is intraday trading taxed in India?

Intraday equity, positions bought and sold on the same day without delivery, is speculative business income. It is taxed at your slab rate plus cess, the same rate treatment as F&O, but it is handled differently for losses: a speculative loss can be set off only against speculative income, and carried forward for four years, against future speculative income alone. That is stricter than F&O, whose non-speculative losses set off against most other income except salary and carry forward for eight years. So intraday and F&O are both slab-rate business income, but a losing intraday year traps the loss more tightly. Intraday activity is filed on ITR-3, and the loss must be declared in a return filed on time to be carried forward at all.

Do I need a tax audit for F&O trading?

It depends on turnover and declared profit, and turnover for F&O is not notional contract value. It is computed as the absolute value of profits and losses, with option sell premium added, which stays far smaller than the notional you traded. A tax audit under section 44AB broadly applies where that turnover exceeds 10 crore rupees, a high bar reached mainly by very active traders because almost all trading is digital. Below it, a trader can use the presumptive scheme under section 44AD if turnover is within its limit, currently up to 3 crore rupees where receipts are almost entirely digital, by declaring at least 6 percent of turnover as profit; declaring less while total income exceeds the basic exemption can itself trigger audit. These provisions are technical and change, so treat this as orientation and have a qualified CA confirm your own position.

What happens to my trading losses?

They are an asset, but only if you file correctly and on time. Because most F&O activity ends in a net loss, in the SEBI FY25 study over 91 percent of individual F&O traders were net loss-making, the tax question for most traders is really a loss question, not a gains question. Non-speculative F&O losses can be set off against most income except salary in the same year, and carried forward eight years against future business income. Speculative intraday losses set off only against speculative income and carry forward four years. Short-term capital losses set off against any capital gain and carry forward eight years; long-term capital losses only against long-term gains, eight years. Every one of these carry-forwards is forfeited if the return is filed after the due date, so filing a loss year on time is what preserves the benefit.

Does the tax regime or the section 87A rebate change capital gains tax?

Not the rates. The special rates under sections 111A and 112A, 20 percent short-term and 12.5 percent long-term, are the same whether you are on the old or the new regime; the regime changes how your slab income is taxed, which matters for F&O and intraday business income but not for the capital-gains rate itself. Two edge cases matter. First, the section 87A rebate, which can make ordinary income up to a threshold tax-free, does not apply to capital gains taxed at these special rates, so a small investor can still owe 111A or 112A tax even when their slab tax is nil. Second, surcharge on high incomes is capped at 15 percent for capital gains under 111A and 112A, unlike the higher surcharge that can apply to other income. This tool models the base rate and cess only, not surcharge or rebate, which depend on your total income.

Where the facts come from

Sources

STCG at 20 percent, section 111A. The Finance Act 2024 raised short-term capital gains on listed equity and equity-oriented funds with securities transaction tax paid from 15 percent to 20 percent for transfers on or after 23 July 2024. Income-tax Department, capital-gains reference. incometaxindia.gov.in
LTCG at 12.5 percent above the 1,25,000 exemption, section 112A. Long-term capital gains on listed equity and equity funds taxed at 12.5 percent, without indexation, on gains above 1,25,000 rupees per financial year, for transfers on or after 23 July 2024 (raised from 10 percent above 1,00,000 rupees). Income-tax Department, tax-rates reference. incometaxindia.gov.in
F&O as non-speculative business income and audit thresholds. Futures and options treated as non-speculative business income under section 43(5); intraday equity as speculative; tax audit under section 44AB and the presumptive scheme under section 44AD for business income. Income-tax Department. incometaxindia.gov.in
The FY25 loss base rate. SEBI study on the profit and loss of individual traders in the equity derivatives segment: over 91 percent net loss-making in FY25, with aggregate net losses of about 1,05,603 crore rupees, up roughly 41 percent from FY24. sebi.gov.in

Educational note, not tax advice. This tool computes an illustrative figure from the inputs you enter, on representative rates for FY 2025-26 as understood in July 2026. Every output depends entirely on your numbers and on rules that change with each Finance Act and Budget. It is not tax advice, not a return, and not a substitute for a qualified CA or tax professional, whom you should consult before you file or act on any figure here. Nothing on this page is a recommendation to trade or to buy or sell any security. Bharath Shiksha is an educational publisher, not a SEBI-registered investment adviser or research analyst.