What is Capital Gain?

The assets owned by an individual that may or may not be connected with business or profession are called capital assets. The common examples of capital assets include bonds, mutual funds, jewelry, patents, or trademarks. However, furniture and clothes for personal use, rural agricultural land are not capital assets.

The period of holding, which is ‘short term’ or ‘long term’ differs across various assets. It is defined as per the Income Tax Act, 1961. The LTCG or long-term capital gains tax is charged on the profit generated from an asset such as shares, bonds, commodities, or real estate that is held for the long-term. If the assets are held for less than the specified period, it is called short term capital gains. 

The table below shows you how the capital assets are classified as short-term or long-term based on the holding period.

Taxation of Long Term Capital Gain

The tax rate of long term capital gains for FY 2025-26 depends on the date of transfer.

Taxation of Short Term Capital Gain

The tax rate of short term capital gain of are given below

What is the Capital Gains Calculator?

The Capital Gains Calculator is a utility tool, which shows you the long term and short term capital gains and the tax liability, for equity-oriented mutual funds and listed equity shares.

The Capital Gains Calculator consists of a formula box, where you enter the holding period, the purchase value, and the sale value of the equity-oriented fund. The calculator will display the taxable short-term capital gain or long-term capital gain, depending on the holding period.

How Does Capital Gains Calculator Work?

You can understand the working of an LTCG calculator with this example. You purchased 200 shares of XYZ Company Ltd at Rs 1,000 per share in May 2018. You sold all the 200 shares at Rs 1,800 per share in January 2025.

You have held the shares for more than one year. The profit of Rs 1,60,000 (200*1800 – 200*1000) is called long-term capital gains.

You have to pay the long-term capital gains tax on the gains that are above Rs 1.25 lakh in a financial year. You have the LTCG tax on Rs 35,000. (Rs 1,60,000 – Rs 1,25,000) at 12.5%. You pay a long-term capital gains tax of Rs 4,375. (Rs 35,000@12.5%).

The announcement for the introduction of the long-term capital gains tax on equity-oriented instruments and shares was made during the Union Budget 2018. The new rule was applicable for all the transactions that are made on or after 01 April 2018.

How to Use the ����˫ɫ��Tax LTCG Calculator?

• You have to first select the holding period as less than or equal to one year or greater than 1 year.
• You must enter the sale value and the purchase value of the investment.
• If you have held the shares for more than one year, please select whether you purchased them on or before January 31, 2018, from the dropdown menu.
• If you have purchased the shares on or before 31st Jan 2018, enter the fair market value of security as on 31st Jan, 2018. 
• The ����˫ɫ��Tax Capital Gains Calculator will show you the short-term or long-term capital gains and applicable taxes respectively.

Benefits of Using the ����˫ɫ��Tax Capital Gains Calculator?

• The ����˫ɫ��Tax Capital Gains Calculator will show you the long-term or short-term capital gains tax on the purchase and sale of equity-oriented funds and shares in a matter of seconds.
• You get a birds-eye view of the actual return from the investment after accounting for the taxes. It helps you to plan the duration of the investment in equity funds and shares for maximum tax-efficiency.
• You can plan the investments in equity instruments as you already know the short-term or long-term capital gains tax you would incur depending on the holding period.