Capital Gains Tax 2026: LTCG 12.5%, STCG Rates & How to Report in ITR

Rates at a glance (FY 2025-26)

• Listed equity shares / equity mutual funds with STT:
• STCG (held under 12 months): 20%
• LTCG: 12.5% over Rs. 1.25 lakh exemption
• Property, gold, unlisted shares, other assets:
• STCG: at slab rates (new or old regime)
• LTCG: 12.5% flat, no indexation for assets acquired before 23 July 2024

Key changes from Budget 2024

For assets bought before 23 July 2024 and sold after that date, LTCG is 12.5% with the option of the old rate of 20% with indexation for property. Assets purchased on or after 23 July 2024 are simply taxed at 12.5% with actual cost. The Rs. 1.25 lakh LTCG exemption on listed equity remains.

How to compute a gain

1. Identify the asset category and holding period
2. Calculate the full value of consideration minus transfer expenses
3. Subtract the indexed or actual cost and improvement costs as applicable
4. Apply the correct rate and exemption (1.25 lakh equity, 54, 54EC, 54F conditions)
5. Report asset-wise in Schedule CG of ITR-2/ITR-3

Impact on investors

The 12.5%/no-indexation regime makes custody record-keeping more valuable - brokers and portfolio statements become the evidence for cost. NRIs selling property in India have special computations with MIP calculations; second-time sellers often need professional help for exemptions and TDS credit.

What you should do

• Maintain an asset register with purchase dates, costs and sale dates
• Before selling property, verify eligibility for Section 54/54F reinvestment exemptions
• Report all gains - even small ones - in the correct schedule; AIS already reports property and share transactions
• For inherited assets, compute the acquisition date as the original owner's date
• Reconcile TDS on property sale (Section 194IA, 1%) against 26AS