{"id":6804,"date":"2024-05-04T15:32:22","date_gmt":"2024-05-04T10:02:22","guid":{"rendered":"https:\/\/lakshmishree.com\/blog\/?p=6804"},"modified":"2026-04-06T13:01:56","modified_gmt":"2026-04-06T07:31:56","slug":"ltcg-tax-rate","status":"publish","type":"post","link":"https:\/\/lakshmishree.com\/blog\/ltcg-tax-rate\/","title":{"rendered":"LTCG Tax in India 2026: Rates, Rules &amp; How to Save Tax Legally"},"content":{"rendered":"\n<script type=\"application\/ld+json\">\n[\n  {\n    \"@context\": \"https:\/\/schema.org\",\n    \"@type\": \"SoftwareApplication\",\n    \"name\": \"Lakshmishree LTCG Expert Calculator\",\n    \"operatingSystem\": \"All\",\n    \"applicationCategory\": \"FinanceApplication\",\n    \"offers\": {\n      \"@type\": \"Offer\",\n      \"price\": \"0\",\n      \"priceCurrency\": \"INR\"\n    },\n    \"description\": \"Interactive 2026 LTCG calculator including the 12.5% tax rate, \u20b91.25 Lakh exemption, and 4% Health & Education Cess.\"\n  },\n  {\n    \"@context\": \"https:\/\/schema.org\",\n    \"@type\": \"HowTo\",\n    \"name\": \"How to Calculate LTCG Tax on Shares & Property (2026)\",\n    \"description\": \"Step-by-step guide to calculating Long Term Capital Gains tax in India following the 2024 Budget revisions.\",\n    \"step\": [\n      {\n        \"@type\": \"HowToStep\",\n        \"text\": \"Check holding period: 12+ months for Equity, 24+ months for Property\/Gold.\"\n      },\n      {\n        \"@type\": \"HowToStep\",\n        \"text\": \"Subtract Purchase Price and Transfer Costs from the Sale Price to find Gross LTCG.\"\n      },\n      {\n        \"@type\": \"HowToStep\",\n        \"text\": \"Deduct the \u20b91.25 Lakh annual exemption for Equity\/Equity Mutual Funds.\"\n      },\n      {\n        \"@type\": \"HowToStep\",\n        \"text\": \"Apply 12.5% tax rate on the taxable balance.\"\n      },\n      {\n        \"@type\": \"HowToStep\",\n        \"text\": \"Add 4% Cess on the tax amount for the final liability.\"\n      }\n    ]\n  },\n  {\n    \"@context\": \"https:\/\/schema.org\",\n    \"@type\": \"Dataset\",\n    \"name\": \"India Mutual Fund LTCG Tax Rates 2026\",\n    \"description\": \"The definitive dataset for mutual fund taxation in India, covering Equity, Debt, Hybrid, and Gold fund categories.\",\n    \"creator\": {\n      \"@type\": \"Organization\",\n      \"name\": \"Lakshmishree Investment and Securities\",\n      \"url\": \"https:\/\/lakshmishree.com\"\n    },\n    \"variableMeasured\": [\"Asset Type\", \"Holding Period\", \"Tax Rate\"]\n  }\n]\n<\/script>\n\n\n\n<p>Understanding LTCG, Long Term Capital Gains Tax, is crucial for any investor. What exactly is LTCG? It's the tax applied to the profit gained from selling assets like stocks or real estate that have been held for a longer period, typically over a year. In 2026, knowing how LTCG can impact your investment returns and tax liabilities is more important than ever.<\/p>\n\n\n\n<p>Whether you\u2019re looking to sell investments or find ways to minimize your tax bill, this guide offers easy-to-understand insights and strategies that could let you save Tax legally<\/p>\n\n\n\n<div class=\"wp-block-rank-math-toc-block\" id=\"rank-math-toc\"><h2><strong>Table Of Contents<\/strong><\/h2><nav><ul><li class=\"\"><a href=\"#what-is-long-term-capital-gains-ltcg-tax\">What is Long Term Capital Gains (LTCG) Tax?<\/a><\/li><li class=\"\"><a href=\"#ltcg-tax-rates-in-india-2026-complete-table\">LTCG Tax Rates in India 2026: Complete Table<\/a><\/li><li class=\"\"><a href=\"#\u20b9-1-25-lakh-ltcg-exemption\">\u20b91.25 Lakh LTCG Exemption<\/a><\/li><li class=\"\"><a href=\"#what-changed-in-budget-2024\">LTCG Change In Budget 2024<\/a><ul><\/ul><\/li><li class=\"\"><a href=\"#ltcg-vs-stcg-key-differences-table\">LTCG vs STCG Key Differences Table<\/a><\/li><li class=\"\"><a href=\"#how-to-calculate-ltcg-tax-step-by-step\">How to Calculate LTCG Tax (Step by Step)<\/a><\/li><li class=\"\"><a href=\"#Grandfathering-Rule\">Grandfathering Rule (Pre-2018 Equity Holdings)<\/a><\/li><li class=\"\"><a href=\"#5-legal-ways-to-save-ltcg-tax-in-india-2026\">5 Legal Ways to Save LTCG Tax in India 2026<\/a><ul><\/ul><\/li><li class=\"\"><a href=\"#ltcg-on-mutual-fund-types-in-2026\">LTCG on Mutual Fund Types in 2026<\/a><\/li><li class=\"\"><a href=\"#how-to-report-ltcg-in-itr\">How to Report LTCG in ITR<\/a><ul><\/ul><\/li><li class=\"\"><a href=\"#ltcg-tax-for-nr-is-in-india\">LTCG Tax for NRIs in India<\/a><\/li><li class=\"\"><a href=\"#conclusion\">Conclusion<\/a><\/li><li class=\"\"><a href=\"#frequently-asked-questions-on-ltcg-tax\">Frequently Asked Questions on LTCG Tax<\/a><ul><\/ul><\/li><\/ul><\/nav><\/div>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"what-is-long-term-capital-gains-ltcg-tax\">What is Long Term Capital Gains (LTCG) Tax?<\/h2>\n\n\n\n<p>Long Term Capital Gains (LTCG) Tax is a tax on the profit you earn when you sell a capital asset, like stocks, mutual funds, or property, after holding it for a specified minimum period. In India, the LTCG tax rate and holding period depend on the asset type and were significantly revised in the Union Budget 2024.<\/p>\n\n\n\n<p><strong>Example:<\/strong> You bought shares of Reliance Industries for \u20b91,00,000 in January 2023 and sold them for \u20b91,60,000 in March 2026. Your capital gain is \u20b960,000. Since you held for more than 1 year, this is a Long Term Capital Gain, and the LTCG tax applies to it.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"ltcg-tax-rates-in-india-2026-complete-table\">LTCG Tax Rates in India 2026: Complete Table<\/h2>\n\n\n\n<p>The Union Budget 2024 revised LTCG tax rates significantly. Here are the current rates effective from July 23, 2024:<\/p>\n\n\n\n<figure class=\"wp-block-table\"><table class=\"has-fixed-layout\"><thead><tr><th>Asset Type<\/th><th>Holding Period for LTCG<\/th><th>LTCG Tax Rate<\/th><th>Indexation Benefit<\/th><\/tr><\/thead><tbody><tr><td>Listed Equity Shares<\/td><td>More than 12 months<\/td><td><strong>12.5%<\/strong> (above \u20b91.25 lakh)<\/td><td>Not available<\/td><\/tr><tr><td>Equity Mutual Funds<\/td><td>More than 12 months<\/td><td><strong>12.5%<\/strong> (above \u20b91.25 lakh)<\/td><td>Not available<\/td><\/tr><tr><td>Debt Mutual Funds (bought after Apr 1, 2023)<\/td><td>Taxed as per income slab<\/td><td><strong>As per slab<\/strong><\/td><td>Not available<\/td><\/tr><tr><td>Debt Mutual Funds (bought before Apr 1, 2023)<\/td><td>More than 36 months<\/td><td><strong>12.5%<\/strong><\/td><td>Not available (removed in Budget 2024)<\/td><\/tr><tr><td>Real Estate \/ Property<\/td><td>More than 24 months<\/td><td><strong>12.5%<\/strong><\/td><td>Not available (removed in Budget 2024)<\/td><\/tr><tr><td>Gold (Physical \/ Jewellery)<\/td><td>More than 24 months<\/td><td><strong>12.5%<\/strong><\/td><td>Not available (removed in Budget 2024)<\/td><\/tr><tr><td>Gold ETF \/ Gold Fund<\/td><td>More than 24 months<\/td><td><strong>12.5%<\/strong><\/td><td>Not available<\/td><\/tr><tr><td>Unlisted Shares<\/td><td>More than 24 months<\/td><td><strong>12.5%<\/strong><\/td><td>Not available<\/td><\/tr><tr><td>NRE\/NRO Accounts<\/td><td>Asset dependent<\/td><td>As per <a href=\"http:\/\/Understanding LTCG, Long Term Capital Gains Tax, is crucial for any investor. What exactly is LTCG? It's the tax applied to the profit gained from selling assets like stocks or real estate that have been held for a longer period, typically over a year. In 2026, knowing how LTCG can impact your investment returns and tax liabilities is more important than ever.  Whether you\u2019re looking to sell investments or find ways to minimize your tax bill, this guide offers easy-to-understand insights and strategies that could let you save Tax legally  What is Long Term Capital Gains (LTCG) Tax?  Long Term Capital Gains (LTCG) Tax is a tax on the profit you earn when you sell a capital asset, like stocks, mutual funds, or property, after holding it for a specified minimum period. In India, the LTCG tax rate and holding period depend on the asset type and were significantly revised in the Union Budget 2024.  Example: You bought shares of Reliance Industries for \u20b91,00,000 in January 2023 and sold them for \u20b91,60,000 in March 2026. Your capital gain is \u20b960,000. Since you held for more than 1 year, this is a Long Term Capital Gain, and the LTCG tax applies to it.  LTCG Tax Rates in India 2026: Complete Table  The Union Budget 2024 revised LTCG tax rates significantly. Here are the current rates effective from July 23, 2024:  Asset TypeHolding Period for LTCGLTCG Tax RateIndexation BenefitListed Equity SharesMore than 12 months12.5% (above \u20b91.25 lakh)Not availableEquity Mutual FundsMore than 12 months12.5% (above \u20b91.25 lakh)Not availableDebt Mutual Funds (bought after Apr 1, 2023)Taxed as per income slabAs per slabNot availableDebt Mutual Funds (bought before Apr 1, 2023)More than 36 months12.5%Not available (removed in Budget 2024)Real Estate \/ PropertyMore than 24 months12.5%Not available (removed in Budget 2024)Gold (Physical \/ Jewellery)More than 24 months12.5%Not available (removed in Budget 2024)Gold ETF \/ Gold FundMore than 24 months12.5%Not availableUnlisted SharesMore than 24 months12.5%Not availableNRE\/NRO AccountsAsset dependentAs per DTAA\u2014  Data as of March 2026 per the Income Tax Act, 1961, as amended by the Finance Act 2024.  \u20b91.25 Lakh LTCG Exemption  For listed equity shares and equity mutual funds, the first \u20b91.25 lakh of LTCG per financial year is completely exempt from tax. Only gains above \u20b91.25 lakh are taxed at 12.5%.  Example:  Total LTCG from equity in FY 2025-26: \u20b92,00,000  Exempt: \u20b91,25,000  Taxable LTCG: \u20b975,000  LTCG Tax payable: \u20b975,000 \u00d7 12.5% = \u20b99,375  This \u20b91.25 lakh limit was increased from \u20b91 lakh to \u20b91.25 lakh in Budget 2024, providing mild relief to retail equity investors.  Important: This exemption applies only to equity shares and equity mutual funds. It does not apply to debt funds, real estate, gold, or unlisted shares.  What Changed in Budget 2024  Budget 2024 made the most significant changes to LTCG tax in years. Here is exactly what changed:  The 3 Key LTCG Revisions  Change 1: Rate Increased from 10% to 12.5% on Equity   The LTCG rate on listed equity shares and equity mutual funds increased from 10% to 12.5%. This is effective for gains made on or after July 23, 2024.  Change 2: Indexation Benefit Removed on Property and Gold.   Previously, property and gold sellers could use indexation, adjusting the purchase price for inflation, to reduce their taxable gain. Budget 2024 removed this benefit. This significantly increased the tax burden on property sellers.  Example of impact: If you bought a house for \u20b950 lakh in 2014 and sold for \u20b91.5 crore in 2026, your indexed cost (with inflation adjustment) would have been approximately \u20b995 lakh, giving a taxable gain of \u20b955 lakh. Without indexation, the gain is \u20b91 crore \u2014 almost double the taxable amount.  Change 3: Exemption Limit Raised from \u20b91 Lakh to \u20b91.25 Lakh   A small consolation for equity investors , the annual LTCG exemption was raised from \u20b91,00,000 to \u20b91,25,000. This saves \u20b92,500 in tax per year for investors in the 12.5% bracket.  LTCG vs STCG Key Differences Table   Short Term Capital Gains (STCG) and Long Term Capital Gains (LTCG) are taxed differently. Understanding the difference determines your tax strategy.  FactorLTCGSTCGHolding Period (Equity)More than 12 months12 months or lessTax Rate (Equity)12.5% (above \u20b91.25 lakh)20% (flat, from July 2024)Holding Period (Property\/Gold)More than 24 months24 months or lessTax Rate (Property\/Gold)12.5%As per income slabIndexationNot available (removed)Not applicableSet-off against lossesLTCG can set off LTCG lossesSTCG can set off STCG or LTCG losses  Key insight: STCG on equity was raised from 15% to 20% in Budget 2024. This makes long-term investing even more tax-efficient compared to short-term trading.  How to Calculate LTCG Tax (Step by Step)  Step 1: Determine the sale price and date of the asset sold.  Step 2: Determine the purchase price and date of the asset bought.  Step 3: Calculate the holding period. If it exceeds the threshold (12 months for equity, 24 months for property\/gold), it qualifies as LTCG.  Step 4: Calculate gross LTCG = Sale Price \u2212 Purchase Price \u2212 Transfer Costs (brokerage, STT, etc.)  Step 5: For equity\/equity MF: Deduct \u20b91.25 lakh exemption. The balance is taxable LTCG.  Step 6: Apply 12.5% on taxable LTCG.  Step 7: Add surcharge if applicable (if total income exceeds \u20b950 lakh) and 4% health and education cess on the tax amount.  Worked Example:  Purchased 100 shares of HDFC Bank at \u20b91,200 in March 2024  Sold 100 shares at \u20b91,900 in March 2026  LTCG = (1,900 \u2212 1,200) \u00d7 100 = \u20b970,000  Less: \u20b91,25,000 exemption \u2014 since \u20b970,000 < \u20b91.25 lakh, the entire gain is tax-free  Grandfathering Rule \u2014 Pre-2018 Equity Holdings  For equity shares and equity mutual funds bought before January 31, 2018, a special &quot;grandfathering&quot; rule protects gains earned before LTCG tax was introduced in Budget 2018.  The rule: The cost of acquisition is deemed to be the higher of:  The actual purchase price, OR  The fair market value (closing price) on January 31, 2018  This means gains earned on equity before January 31, 2018, are effectively tax-free. Only post-January 31, 2018, gains are subject to LTCG tax.  This rule still applies in 2026. If you hold shares since 2015, your cost basis is the January 31, 2018 price, not your original purchase price.  5 Legal Ways to Save LTCG Tax in India 2026  Strategy 1: Harvest \u20b91.25 Lakh Every Year   Since the first \u20b91.25 lakh of equity LTCG is tax-free each financial year, book profits up to this limit every March and reinvest. Over 10 years, this strategy can save \u20b915,000+ in taxes with zero investment change.  Example: You have an investment with a \u20b92,00,000 profit. If you sell it all at once, you pay tax on \u20b975,000 (after the \u20b91.25L exemption). Instead, if you sell only enough to book \u20b91,25,000 profit this March and reinvest it the next day, you pay \u20b90 tax and your cost price for the future is now higher.  Strategy 2: Set Off LTCG Against Long-Term Capital Losses  If you have made long-term losses on any equity investment, they can be used to offset your LTCG, reducing your taxable gain. Long-term losses can be carried forward for 8 years.  Example: Imagine you have a \u20b93,00,000 profit from Sun Pharma but a \u20b91,00,000 loss from a struggling small-cap stock. By selling both, your taxable gain drops to \u20b92,00,000. After the standard \u20b91.25L exemption, you only pay tax on \u20b975,000 instead of \u20b91,75,000.  Strategy 3: Invest in ELSS (Equity Linked Savings Scheme)  ELSS funds have a 3-year lock-in. The gains on redemption after 3 years are LTCG \u2014 subject to the \u20b91.25 lakh exemption. Unlike other 80C instruments, the investment itself saves tax (up to \u20b91.5 lakh under Section 80C) AND redemption benefits from the LTCG exemption.  Example: You invest \u20b91.5 Lakh in an ELSS fund. You immediately save ~\u20b945,000 in income tax (if in the 30% bracket). After 3 years, if that investment grows to \u20b92.5 Lakh, the \u20b91 Lakh gain is entirely tax-free because it falls under your annual LTCG limit.  Strategy 4: Transfer Assets to Spouse or Family (Gift)   Gifting listed shares to a spouse or family member does not attract gift tax in India. The recipient can then sell and use their own \u20b91.25 lakh exemption. Two people = \u20b92.5 lakh combined annual LTCG exemption on equity.  Example: You have \u20b92.5 Lakh in total capital gains. If you book it all, you pay tax on \u20b91.25 Lakh. However, if you gift half the shares to your spouse (who has no other income) and you both sell your respective shares, you both use your individual \u20b91.25L exemptions. Result: Total Tax Paid = \u20b90.  Note: Consult a tax advisor before executing this strategy \u2014 clubbing provisions may apply depending on the relationship.  Strategy 5: SIP Investment Horizon Planning   Each SIP instalment is a separate purchase with its own holding period. For equity SIPs, ensure each instalment has been held for at least 12 months before redemption to qualify for LTCG treatment (at 12.5%) rather than STCG treatment (at 20%).  Example: You started a monthly SIP in January 2025. If you sell the entire portfolio in February 2026, only the first two installments (Jan &amp; Feb 2025) qualify for the lower 12.5% LTCG tax. The other 10 installments are less than a year old and will be taxed as STCG at a much higher 20% rate.  StrategyPrimary BenefitThe &quot;How-To&quot; ExamplePotential Tax Saving1. Tax HarvestingUses annual \u20b91.25L exemption.Book \u20b91.25L profit every March and reinvest immediately to reset your cost price.\u20b915,000+ per year2. Loss OffsettingNeutralizes gains with losses.Sell a loss-making stock to offset a \u20b93L profit. Taxable gain drops to \u20b92L.\u20b912,500 (on \u20b91L loss)3. ELSS InvestingDual tax deduction.Invest \u20b91.5L for 80C deduction; gains are tax-free up to the \u20b91.25L limit.\u20b945,000 (upfront)4. Family GiftingDoubles the tax-free limit.Gift shares to a spouse. Two people selling means a \u20b92.5L combined tax-free profit.\u20b915,6255. SIP PlanningAvoids 20% STCG trap.Hold each SIP for 12+ months to qualify for 12.5% LTCG instead of 20% STCG.7.5% of total gains  LTCG on Mutual Funds in 2026 \u2014 Categories Explained  Before investing in mutual funds, it is important to understand how taxation affects your returns. In 2026, LTCG rules vary across categories, depending on both holding period and asset type\u2014such as equity, debt, or gold. Similar-looking investments can lead to very different post-tax outcomes. The table below provides a clear, category-wise summary of these differences.  Mutual Fund CategoryHolding PeriodTax RateNotesEquity Funds (65%+ equity)12+ months12.5% above \u20b91.25LMost common \u2014 Nifty index funds, large cap, flexi capELSS Funds3 years (mandatory lock-in)12.5% above \u20b91.25LAlso gives 80C benefitHybrid Equity Funds (65%+ equity)12+ months12.5% above \u20b91.25LBalanced advantage, aggressive hybridDebt Funds (bought before Apr 1, 2023)36+ months12.5%No indexation from FY2024Debt Funds (bought after Apr 1, 2023)Any holding periodAs per income slabTreated like FD interestInternational Funds24+ months12.5%Fund-of-fund structure; taxed as debt if equity < 65%Gold Funds \/ ETFs24+ months12.5%No indexation  Data as of March 2026. Verify with a tax professional for your specific situation.  How to Report LTCG in ITR \u2014 Which Form to Use  LTCG must be reported in your Income Tax Return. The applicable ITR form depends on your income sources:  ITR-2: For individuals with capital gains from equity, mutual funds, or property (but no business income)  ITR-3: For individuals with capital gains AND business or professional income  For equity LTCG specifically: Report in Schedule CG (Capital Gains) \u2192 Long Term Capital Gains \u2192 Section 112A (for equity and equity MFs).  The broker's Statement of Capital Gains (available on Lakshmishree's platform) provides a ready calculation. Download it at the start of the new financial year and use it directly for ITR filing.  LTCG Tax for NRIs in India  Non-Resident Indians (NRIs) are also subject to LTCG tax on Indian assets, with one key difference: TDS (Tax Deducted at Source) is applicable at the point of sale.  Equity \/ Equity MF: 12.5% TDS on LTCG above \u20b91.25 lakh  Property: 12.5% TDS deducted by buyer before payment to NRI seller  Double Tax Avoidance Agreement (DTAA): NRIs from countries with a DTAA with India may get relief; consult a tax advisor for this.   NRIs can claim a refund if TDS deducted exceeds their actual tax liability by filing an ITR in India.  Frequently Asked Questions on LTCG Tax  What is the LTCG tax rate in India in 2026? The LTCG tax rate for listed equity shares and equity mutual funds is 12.5% on gains above \u20b91.25 lakh per financial year. For real estate, gold, and debt funds (pre-April 2023), the rate is also 12.5% but without the exemption or indexation benefit.  Is LTCG tax applicable on SIP returns? Yes. Each SIP instalment is a separate purchase. If you redeem after holding each instalment for more than 12 months, the gains are LTCG taxed at 12.5%. If redeemed before 12 months, STCG at 20% applies.  What is the LTCG tax on property in 2026? Property sold after holding for more than 24 months attracts LTCG at 12.5%. Indexation benefit was removed in Budget 2024. So your entire capital gain (sale price minus original purchase price) is taxed at 12.5%.  Can LTCG losses be carried forward? Yes. Long-term capital losses can be carried forward for 8 assessment years and can only be set off against future LTCG \u2014 not against STCG or any other income.  What is the LTCG exemption limit in 2026? \u20b91.25 lakh per financial year for equity shares and equity mutual funds. This was increased from \u20b91 lakh in Budget 2024.  Is LTCG applicable on PPF, EPF, and NPS withdrawals? No. PPF and EPF withdrawals are fully tax-exempt. NPS withdrawals have their own tax treatment \u2014 60% of the corpus withdrawn at maturity is tax-free; 40% used for annuity is taxable as income.  What is LTCG tax on gold in 2026? Physical gold, gold ETFs, and gold funds held for more than 24 months attract LTCG at 12.5% without indexation benefit (as of Budget 2024).  Conclusion  Long Term Capital Gains Tax in India was restructured significantly in Budget 2024 \u2014 the rate increased from 10% to 12.5% on equity, indexation was removed on property and gold, and the exemption was raised from \u20b91 lakh to \u20b91.25 lakh. For most retail equity investors, the impact is manageable \u2014 especially those who invest systematically through SIPs and hold long-term.  The most effective tax-saving strategy remains simple: harvest your \u20b91.25 lakh annual exemption every March, use long-term losses to offset gains, and invest through ELSS for the combined 80C + LTCG benefit.  Lakshmishree Investment and Securities is a SEBI-registered stockbroker (Reg. No. INZ000200835). This article is for educational purposes only and does not constitute tax or investment advice. Consult a CA or tax professional for personalised guidance.  What you need to do from your side before publishing:  1. Verify the exact LTCG rate is still 12.5% \u2014 Budget 2025 (presented February 2025) may have made further changes. Check incometax.gov.in or a CA website to confirm no changes since July 2024.  2. Add the current financial year FY2025-26 clearly in the intro \u2014 mention this is for FY2025-26 assessments.  3. Add a &quot;Last Updated&quot; date prominently \u2014 LTCG tax is the kind of content that readers specifically check for freshness. Make March 27, 2026 very visible.  4. Add a Lakshmishree capital gains calculator \u2014 if you can build a simple calculator (investment amount \u00d7 gain % \u2192 LTCG tax output), it will dramatically increase dwell time and separate you from every other page on this topic.  5. Internal links to add:  From your best banks post \u2192 mention FD interest is different (not LTCG, taxed as income)  From your SWP post \u2192 link here (SWP redemption triggers LTCG)  From your ETF posts \u2192 link here (ETF gains are LTCG)  From your mutual fund posts \u2192 link here  Frequently Asked Questions  Q1. How is LTCG calculated?To calculate long-term capital gains tax, you'll need to consider the full value received from the sale, the indexed costs of acquisition and improvement, and the transfer cost.Q2. What is the tax rate for LTCG in India?The tax rate for long-term capital gains in India is 10% for equity and equity-related instruments, with an exemption limit of up to Rs. 1 lakh. Additionally, the tax rate for debt-oriented mutual funds with indexation is 20%.Q3. What is indexation in relation to LTCG?Indexation is a method that adjusts the purchase cost of an asset for inflation using the Cost Inflation Index (CII) provided by the government, thus reducing the taxable capital gain. It is not applied to equity shares and mutual funds.Q4. Are there any exemptions available for LTCG?Yes, exemptions are available for long-term capital gain tax under various sections of the Income Tax Act. One example is when capital gains from transferring a long-term capital asset, other than a residential house, are invested in acquiring a residential property.Q5. Difference between Short Term and Long Term Capital GainShort Term Capital Gains (STCG) arise when you sell an asset within a year of purchasing it. These gains are taxed according to your income tax slab rates for most assets, except for listed securities (like stocks), which are taxed at 15%. Long Term Capital Gains (LTCG) occur when an asset is sold after being held for more than a year. LTCG is taxed at a lower rate, generally 20% with indexation for assets like real estate and debt funds, and 10% for equity and equity-related instruments if gains exceed \u20b91 lakh in a financial year.Q6. Long Term Capital Gain on Sale of PropertyLTCG on property applies if held for more than two years and is taxed at 20% with indexation. Exemptions are available under Section 54 (if reinvested in residential property) or Section 54EC (if invested in certain bonds).Q7. How Much Capital Gain is Tax-Free?For equity investments, gains up to \u20b91 lakh per financial year are tax-free; gains above this are taxed at 10%. Indexation reduces taxable gains for other assets like property, and exemptions may apply if proceeds are reinvested according to specific rules.\">DTAA<\/a><\/td><td>\u2014<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n<p><em>Data as of March 2026 per the Income Tax Act, 1961, as amended by the Finance Act 2024.<\/em><\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"\u20b9-1-25-lakh-ltcg-exemption\">\u20b91.25 Lakh LTCG Exemption<\/h2>\n\n\n\n<p>For listed equity shares and equity mutual funds, the first \u20b91.25 lakh of LTCG per financial year is completely exempt from tax. Only gains above \u20b91.25 lakh are taxed at 12.5%.<\/p>\n\n\n\n<p><strong>Example:<\/strong><\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Total LTCG from equity in FY 2025-26: \u20b92,00,000<\/li>\n\n\n\n<li>Exempt: \u20b91,25,000<\/li>\n\n\n\n<li>Taxable LTCG: \u20b975,000<\/li>\n\n\n\n<li>LTCG Tax payable: \u20b975,000 \u00d7 12.5% = <strong>\u20b99,375<\/strong><\/li>\n<\/ul>\n\n\n\n<p>This \u20b91.25 lakh limit was increased from \u20b91 lakh to \u20b91.25 lakh in Budget 2024, providing mild relief to retail equity investors.<\/p>\n\n\n\n<p><strong>Important:<\/strong> This exemption applies only to equity shares and equity mutual funds. It does not apply to debt funds, real estate, gold, or unlisted shares.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"what-changed-in-budget-2024\">LTCG Change In Budget 2024<\/h2>\n\n\n\n<p>Budget 2024 made the most significant changes to LTCG tax in years. Here is exactly what changed:<\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"the-3-key-ltcg-revisions\">The 3 Key LTCG Revisions<\/h3>\n\n\n\n<p><strong>Change 1: Rate Increased from 10% to 12.5% on Equity<\/strong> <\/p>\n\n\n\n<p>The LTCG rate on listed equity shares and equity mutual funds increased from 10% to 12.5%. This is effective for gains made on or after July 23, 2024.<\/p>\n\n\n\n<p><strong>Change 2: Indexation Benefit Removed on Property and Gold<\/strong>. <\/p>\n\n\n\n<p>Previously, property and gold sellers could use indexation, adjusting the purchase price for inflation, to reduce their taxable gain. Budget 2024 removed this benefit. This significantly increased the tax burden on property sellers.<\/p>\n\n\n\n<p><em>Example of impact: If you bought a house for \u20b950 lakh in 2014 and sold for \u20b91.5 crore in 2026, your indexed cost (with inflation adjustment) would have been approximately \u20b995 lakh, giving a taxable gain of \u20b955 lakh. Without indexation, the gain is \u20b91 crore i.e. almost double the taxable amount.<\/em><\/p>\n\n\n\n<p><strong>Change 3: Exemption Limit Raised from \u20b91 Lakh to \u20b91.25 Lakh<\/strong> <\/p>\n\n\n\n<p>A small consolation for equity investors , the annual LTCG exemption was raised from \u20b91,00,000 to \u20b91,25,000. This saves \u20b92,500 in tax per year for investors in the 12.5% bracket.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"ltcg-vs-stcg-key-differences-table\">LTCG vs STCG Key Differences Table<\/h2>\n\n\n\n<p>Short Term Capital Gains (STCG) and Long Term Capital Gains (LTCG) are taxed differently. Understanding the difference determines your tax strategy.<\/p>\n\n\n\n<figure class=\"wp-block-table\"><table class=\"has-fixed-layout\"><thead><tr><th>Factor<\/th><th>LTCG<\/th><th>STCG<\/th><\/tr><\/thead><tbody><tr><td>Holding Period (Equity)<\/td><td>More than 12 months<\/td><td>12 months or less<\/td><\/tr><tr><td>Tax Rate (Equity)<\/td><td>12.5% (above \u20b91.25 lakh)<\/td><td>20% (flat, from July 2024)<\/td><\/tr><tr><td>Holding Period (Property\/Gold)<\/td><td>More than 24 months<\/td><td>24 months or less<\/td><\/tr><tr><td>Tax Rate (Property\/Gold)<\/td><td>12.5%<\/td><td>As per income slab<\/td><\/tr><tr><td>Indexation<\/td><td>Not available (removed)<\/td><td>Not applicable<\/td><\/tr><tr><td>Set-off against losses<\/td><td>LTCG can set off LTCG losses<\/td><td>STCG can set off STCG or LTCG losses<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n<p><strong>Key insight:<\/strong> <a href=\"https:\/\/lakshmishree.com\/blog\/short-term-capital-gain-tax\/\" data-type=\"post\" data-id=\"7446\">STCG <\/a>on equity was raised from 15% to 20% in Budget 2024. This makes long-term investing even more tax-efficient compared to short-term trading.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"how-to-calculate-ltcg-tax-step-by-step\">How to Calculate LTCG Tax (Step by Step)<\/h2>\n\n\n\n<div style=\"height:24px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n\n\n<div style=\"max-width:400px; margin:20px auto; font-family:sans-serif; border:1px solid #ddd; border-radius:12px; overflow:hidden; box-shadow:0 4px 12px rgba(0,0,0,0.1);\">\n    <div style=\"background:#00529b; color:#fff; padding:15px; text-align:center;\">\n        <strong style=\"display:block; font-size:18px;\">LTCG Tax Expert Tool<\/strong>\n        <small style=\"opacity:0.8;\">2026 Rates: 12.5% + 4% Cess<\/small>\n    <\/div>\n\n    <div style=\"padding:20px; background:#fff;\">\n        <div style=\"margin-bottom:12px;\">\n            <label style=\"display:block; font-size:12px; font-weight:bold; margin-bottom:5px;\">Purchase Price (\u20b9)<\/label>\n            <input type=\"number\" id=\"buy\" placeholder=\"e.g. 1200\" style=\"width:100%; padding:10px; border:1px solid #ccc; border-radius:6px; box-sizing:border-box;\">\n        <\/div>\n        <div style=\"margin-bottom:12px;\">\n            <label style=\"display:block; font-size:12px; font-weight:bold; margin-bottom:5px;\">Sale Price (\u20b9)<\/label>\n            <input type=\"number\" id=\"sell\" placeholder=\"e.g. 1900\" style=\"width:100%; padding:10px; border:1px solid #ccc; border-radius:6px; box-sizing:border-box;\">\n        <\/div>\n        <div style=\"margin-bottom:15px;\">\n            <label style=\"display:block; font-size:12px; font-weight:bold; margin-bottom:5px;\">Quantity<\/label>\n            <input type=\"number\" id=\"qty\" placeholder=\"e.g. 100\" style=\"width:100%; padding:10px; border:1px solid #ccc; border-radius:6px; box-sizing:border-box;\">\n        <\/div>\n\n        <button onclick=\"calLTCG()\" style=\"width:100%; background:#00529b; color:#fff; padding:12px; border:none; border-radius:6px; font-weight:bold; cursor:pointer;\">Calculate Tax<\/button>\n\n        <div style=\"display:flex; gap:5px; margin-top:10px;\">\n            <button onclick=\"alert('Tax Saving Strategies:\\n1. Tax Harvesting (\u20b91.25L)\\n2. Loss Set-off\\n3. Family Gifting')\" style=\"flex:1; font-size:10px; padding:8px; background:#f0f7ff; border:1px solid #00529b; border-radius:4px; cursor:pointer;\">SAVE TAX<\/button>\n            <button class=\"popmake-11953\" style=\"flex:1.5; font-size:10px; padding:8px; background:#FF9933; color:#fff; border:none; border-radius:4px; font-weight:bold; cursor:pointer;\">OPEN FREE DEMAT<\/button>\n        <\/div>\n\n        <div id=\"res\" style=\"display:none; margin-top:15px; padding:15px; background:#f9f9f9; border-radius:8px; border-left:4px solid #00529b; text-align:center;\">\n            <small style=\"color:#666;\">Estimated Tax Payable<\/small>\n            <div id=\"taxVal\" style=\"font-size:24px; font-weight:bold; color:#d32f2f;\"><\/div>\n        <\/div>\n    <\/div>\n<\/div>\n\n<script>\nfunction calLTCG() {\n    const b = parseFloat(document.getElementById('buy').value),\n          s = parseFloat(document.getElementById('sell').value),\n          q = parseFloat(document.getElementById('qty').value);\n    \n    if(!b || !s || !q) return alert(\"Enter all values\");\n    \n    const profit = (s - b) * q;\n    const taxable = Math.max(0, profit - 125000);\n    const tax = taxable * 0.125 * 1.04;\n\n    document.getElementById('taxVal').innerText = \"\u20b9\" + Math.round(tax).toLocaleString('en-IN');\n    document.getElementById('res').style.display = \"block\";\n}\n<\/script>\n\n\n\n<div style=\"height:17px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n\n\n<p><strong>Step 1:<\/strong> Determine the sale price and date of the asset sold.<\/p>\n\n\n\n<p><strong>Step 2:<\/strong> Determine the purchase price and date of the asset bought.<\/p>\n\n\n\n<p><strong>Step 3:<\/strong> Calculate the holding period. If it exceeds the threshold (12 months for equity, 24 months for property\/gold), it qualifies as LTCG.<\/p>\n\n\n\n<p><strong>Step 4:<\/strong> Calculate gross LTCG = Sale Price \u2212 Purchase Price \u2212 Transfer Costs (brokerage, STT, etc.)<\/p>\n\n\n\n<p><strong>Step 5:<\/strong> For equity\/equity MF: Deduct \u20b91.25 lakh exemption. The balance is taxable LTCG.<\/p>\n\n\n\n<p><strong>Step 6:<\/strong> Apply 12.5% on taxable LTCG.<\/p>\n\n\n\n<p><strong>Step 7:<\/strong> Add surcharge if applicable (if total income exceeds \u20b950 lakh) and 4% health and education cess on the tax amount.<\/p>\n\n\n\n<p><strong>Worked Example:<\/strong><\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Purchased 100 shares of HDFC Bank at \u20b91,200 in March 2024<\/li>\n\n\n\n<li>Sold 100 shares at \u20b91,900 in March 2026<\/li>\n\n\n\n<li>LTCG = (1,900 \u2212 1,200) \u00d7 100 = \u20b970,000<\/li>\n\n\n\n<li>Less: \u20b91,25,000 exemption-- since \u20b970,000 &lt; \u20b91.25 lakh, the <strong>entire gain is tax-free<\/strong><\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"Grandfathering-Rule\">Grandfathering Rule (Pre-2018 Equity Holdings)<\/h2>\n\n\n\n<p id=\"Grandfathering-Rule\">For equity shares and equity mutual funds bought before January 31, 2018, a special grandfathering rule protects gains earned before LTCG tax was introduced in Budget 2018.<\/p>\n\n\n\n<p>The Rule: The cost of acquisition is deemed to be the higher of:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>The actual purchase price, OR<\/li>\n\n\n\n<li>The fair market value (closing price) on January 31, 2018<\/li>\n<\/ul>\n\n\n\n<p>This means gains earned on equity before January 31, 2018, are effectively tax-free. Only post-January 31, 2018, gains are subject to LTCG tax.<\/p>\n\n\n\n<p><strong>This rule still applies in 2026.<\/strong> If you hold shares since 2015, your cost basis is the January 31, 2018 price, not your original purchase price.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"5-legal-ways-to-save-ltcg-tax-in-india-2026\">5 Legal Ways to Save LTCG Tax in India 2026<\/h2>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"strategy-1-harvest-\u20b9-1-25-lakh-every-year\"><strong>Strategy 1: Harvest \u20b91.25 Lakh Every Year<\/strong> <\/h3>\n\n\n\n<p>Since the first \u20b91.25 lakh of equity LTCG is tax-free each financial year, book profits up to this limit every March and reinvest. Over 10 years, this strategy can save \u20b915,000+ in taxes with zero investment change.<\/p>\n\n\n\n<p><strong>Example:<\/strong> You have an investment with a \u20b92,00,000 profit. If you sell it all at once, you pay tax on \u20b975,000 (after the \u20b91.25L exemption). Instead, if you sell only enough to book \u20b91,25,000 profit this March and reinvest it the next day, you pay \u20b90 tax and your cost price for the future is now higher.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"strategy-2-set-off-ltcg-against-long-term-capital-losses\"><strong>Strategy 2: Set Off LTCG Against Long-Term Capital Losses<\/strong><\/h3>\n\n\n\n<p>If you have made long-term losses on any equity investment, they can be used to offset your LTCG, reducing your taxable gain. Long-term losses can be carried forward for 8 years.<\/p>\n\n\n\n<p><strong>Example:<\/strong> Imagine you have a \u20b93,00,000 profit from Sun Pharma but a \u20b91,00,000 loss from a struggling small-cap stock. By selling both, your taxable gain drops to \u20b92,00,000. After the standard \u20b91.25L exemption, you only pay tax on <strong>\u20b975,000<\/strong> instead of \u20b91,75,000.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"strategy-3-invest-in-elss-equity-linked-savings-scheme\"><strong>Strategy 3: Invest in ELSS (Equity Linked Savings Scheme)<\/strong><\/h3>\n\n\n\n<p>ELSS funds have a 3-year lock-in. The gains on redemption after 3 years are LTCG, subject to the \u20b91.25 lakh exemption. Unlike other 80C instruments, the investment itself saves tax (up to \u20b91.5 lakh under Section 80C) AND redemption benefits from the LTCG exemption.<\/p>\n\n\n\n<p><strong>Example:<\/strong> You invest \u20b91.5 Lakh in an ELSS fund. You immediately save ~\u20b945,000 in income tax (if in the 30% bracket). After 3 years, if that investment grows to \u20b92.5 Lakh, the \u20b91 Lakh gain is entirely tax-free because it falls under your annual LTCG limit.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"strategy-4-transfer-assets-to-spouse-or-family-gift\"><strong>Strategy 4: Transfer Assets to Spouse or Family (Gift)<\/strong> <\/h3>\n\n\n\n<p>Gifting listed shares to a spouse or family member does not attract gift tax in India. The recipient can then sell and use their own \u20b91.25 lakh exemption. Two people = \u20b92.5 lakh combined annual LTCG exemption on equity.<\/p>\n\n\n\n<p><strong>Example:<\/strong> You have \u20b92.5 Lakh in total capital gains. If you book it all, you pay tax on \u20b91.25 Lakh. However, if you gift half the shares to your spouse (who has no other income) and you both sell your respective shares, you both use your individual \u20b91.25L exemptions. Result: <strong>Total Tax Paid = \u20b90.<\/strong><\/p>\n\n\n\n<p><em>Note: Consult a tax advisor before executing this strategy. Clubbing provisions may apply depending on the relationship.<\/em><\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"strategy-5-sip-investment-horizon-planning\"><strong>Strategy 5: SIP Investment Horizon Planning<\/strong> <\/h3>\n\n\n\n<p>Each SIP instalment is a separate purchase with its own holding period. For equity SIPs, ensure each instalment has been held for at least 12 months before redemption to qualify for LTCG treatment (at 12.5%) rather than STCG treatment (at 20%).<\/p>\n\n\n\n<p>Example: You started a monthly SIP in January 2025. If you sell the entire portfolio in February 2026, only the first two installments (Jan &amp; Feb 2025) qualify for the lower 12.5% LTCG tax. The other 10 installments are less than a year old and will be taxed as <strong>STCG at a much higher 20% rate.<\/strong><\/p>\n\n\n\n<figure class=\"wp-block-table\"><table class=\"has-fixed-layout\"><thead><tr><td><strong>Strategy<\/strong><\/td><td><strong>Primary Benefit<\/strong><\/td><td><strong>How-To Example<\/strong><\/td><td><strong>Potential Tax Saving<\/strong><\/td><\/tr><\/thead><tbody><tr><td><strong>1. Tax Harvesting<\/strong><\/td><td>Uses annual \u20b91.25L exemption.<\/td><td>Book <strong>\u20b91.25L profit<\/strong> every March and reinvest immediately to reset your cost price.<\/td><td><strong>\u20b915,000+<\/strong> per year<\/td><\/tr><tr><td><strong>2. Loss Offsetting<\/strong><\/td><td>Neutralizes gains with losses.<\/td><td>Sell a loss-making stock to offset a <strong>\u20b93L profit<\/strong>. Taxable gain drops to \u20b92L.<\/td><td><strong>\u20b912,500<\/strong> (on \u20b91L loss)<\/td><\/tr><tr><td><strong>3. ELSS Investing<\/strong><\/td><td>Dual tax deduction.<\/td><td>Invest \u20b91.5L for <strong>80C deduction<\/strong>; gains are tax-free up to the \u20b91.25L limit.<\/td><td><strong>\u20b945,000<\/strong> (upfront)<\/td><\/tr><tr><td><strong>4. Family Gifting<\/strong><\/td><td>Doubles the tax-free limit.<\/td><td>Gift shares to a spouse. Two people selling means a <strong>\u20b92.5L combined<\/strong> tax-free profit.<\/td><td><strong>\u20b915,625<\/strong><\/td><\/tr><tr><td><strong>5. SIP Planning<\/strong><\/td><td>Avoids 20% STCG trap.<\/td><td>Hold each SIP for <strong>12+ months<\/strong> to qualify for 12.5% LTCG instead of 20% STCG.<\/td><td><strong>7.5%<\/strong> of total gains<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"ltcg-on-mutual-fund-types-in-2026\">LTCG on Mutual Fund Types in 2026<\/h2>\n\n\n\n<p>Before investing in mutual funds, it is important to understand how taxation affects your returns. In 2026, LTCG rules vary across categories, depending on both holding period and asset type such as equity, debt, or gold. Similar-looking investments can lead to very different post-tax outcomes. The table below provides a clear, category-wise summary of these differences.<\/p>\n\n\n\n<figure class=\"wp-block-table\"><table class=\"has-fixed-layout\"><thead><tr><th>Mutual Fund Category<\/th><th>Holding Period<\/th><th>Tax Rate<\/th><th>Notes<\/th><\/tr><\/thead><tbody><tr><td>Equity Funds (65%+ equity)<\/td><td>12+ months<\/td><td>12.5% above \u20b91.25L<\/td><td>Most common: Nifty index funds, large cap, flexi cap<\/td><\/tr><tr><td>ELSS Funds<\/td><td>3 years (mandatory lock-in)<\/td><td>12.5% above \u20b91.25L<\/td><td>Also gives 80C benefit<\/td><\/tr><tr><td>Hybrid Equity Funds (65%+ equity)<\/td><td>12+ months<\/td><td>12.5% above \u20b91.25L<\/td><td>Balanced advantage, aggressive hybrid<\/td><\/tr><tr><td>Debt Funds (bought before Apr 1, 2023)<\/td><td>36+ months<\/td><td>12.5%<\/td><td>No indexation from FY2024<\/td><\/tr><tr><td>Debt Funds (bought after Apr 1, 2023)<\/td><td>Any holding period<\/td><td>As per income slab<\/td><td>Treated like FD interest<\/td><\/tr><tr><td>International Funds<\/td><td>24+ months<\/td><td>12.5%<\/td><td>Fund-of-fund structure; taxed as debt if equity &lt; 65%<\/td><\/tr><tr><td>Gold Funds \/ <a class=\"wpil_keyword_link\" href=\"https:\/\/lakshmishree.com\/blog\/15-best-etfs-in-india-to-invest-in-2024\/\"   title=\"ETFs\" data-wpil-keyword-link=\"linked\">ETFs<\/a><\/td><td>24+ months<\/td><td>12.5%<\/td><td>No indexation<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n<p><em>Data as of March 2026. Verify with a tax professional for your specific situation.<\/em><\/p>\n\n\n\n<div style=\"height:19px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n\n\n<figure class=\"wp-block-image size-full popmake-11953\"><img fetchpriority=\"high\" decoding=\"async\" width=\"909\" height=\"280\" src=\"https:\/\/lakshmishree.com\/blog\/wp-content\/uploads\/2025\/09\/image-1.jpeg\" alt=\"\" class=\"wp-image-13525\" srcset=\"https:\/\/lakshmishree.com\/blog\/wp-content\/uploads\/2025\/09\/image-1.jpeg 909w, https:\/\/lakshmishree.com\/blog\/wp-content\/uploads\/2025\/09\/image-1-752x232.jpeg 752w, https:\/\/lakshmishree.com\/blog\/wp-content\/uploads\/2025\/09\/image-1-768x237.jpeg 768w, https:\/\/lakshmishree.com\/blog\/wp-content\/uploads\/2025\/09\/image-1-150x46.jpeg 150w\" sizes=\"(max-width: 909px) 100vw, 909px\" \/><\/figure>\n\n\n\n<div style=\"height:17px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"how-to-report-ltcg-in-itr\">How to Report LTCG in ITR<\/h2>\n\n\n\n<p>LTCG must be reported in your Income Tax Return. The applicable ITR form depends on your income sources:<\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"which-form-to-use-to-report-ltcg-in-itr\">Which Form to Use to Report LTCG in ITR<\/h3>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>ITR-2:<\/strong> For individuals with capital gains from equity, mutual funds, or property (but no business income)<\/li>\n\n\n\n<li><strong>ITR-3:<\/strong> For individuals with capital gains AND business or professional income<\/li>\n<\/ul>\n\n\n\n<p><strong>For equity LTCG specifically:<\/strong> Report in Schedule CG (Capital Gains) \u2192 Long Term Capital Gains \u2192 Section 112A (for equity and equity MFs).<\/p>\n\n\n\n<p>The broker's Statement of Capital Gains (available on Lakshmishree's platform) provides a ready calculation. Download it at the start of the new financial year and use it directly for ITR filing.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"ltcg-tax-for-nr-is-in-india\">LTCG Tax for NRIs in India<\/h2>\n\n\n\n<p>Non-Resident Indians (NRIs) are also subject to LTCG tax on Indian assets, with one key difference: TDS (Tax Deducted at Source) is applicable at the point of sale.<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Equity \/ Equity MF:<\/strong> 12.5% TDS on LTCG above \u20b91.25 lakh<\/li>\n\n\n\n<li><strong>Property:<\/strong> 12.5% TDS deducted by buyer before payment to NRI seller<\/li>\n\n\n\n<li><strong>Double Tax Avoidance Agreement (DTAA):<\/strong> NRIs from countries with a <a href=\"https:\/\/www.incometaxindia.gov.in\/dtaa\" target=\"_blank\" rel=\"noopener\">DTAA <\/a>with India may get relief; consult a tax advisor for this. <\/li>\n<\/ul>\n\n\n\n<p>NRIs can claim a refund if TDS deducted exceeds their actual tax liability by filing an ITR in India.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"conclusion\">Conclusion<\/h2>\n\n\n\n<p>Long Term Capital Gains Tax in India was restructured significantly in Budget 2024, and the rate increased from 10% to 12.5% on equity, indexation was removed on property and gold, and the exemption was raised from \u20b91 lakh to \u20b91.25 lakh. For most retail equity investors, the impact is manageable, especially those who invest systematically through SIPs and hold long-term.<\/p>\n\n\n\n<p>The most effective tax-saving strategy remains simple: harvest your \u20b91.25 lakh annual exemption every March, use long-term losses to offset gains, and invest through ELSS for the combined 80C + LTCG benefit.<\/p>\n\n\n\n<p><em>Lakshmishree Investment and Securities is a SEBI-registered stockbroker (Reg. No. INZ000200835). This article is for educational purposes only and does not constitute tax or investment advice. Consult a CA or tax professional for personalised guidance.<\/em><\/p>\n\n\n\n<div class=\"wp-block-group\"><div class=\"wp-block-group__inner-container is-layout-constrained wp-block-group-is-layout-constrained\">\n<p>The Related Reading Section<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><a href=\"\/blog\/best-banks-in-india\/\">Best Private Banks in India 2026: Top Picks Ranked<\/a><\/li>\n\n\n\n<li><a href=\"\/blog\/best-swp-mutual-funds\/\">Best SWP Mutual Funds 2026: Generate Monthly Income<\/a><\/li>\n\n\n\n<li><a href=\"\/blog\/types-of-mutual-funds\/\">Types of Mutual Funds in India \u2014 Complete Guide<\/a><\/li>\n\n\n\n<li><a href=\"\/blog\/psu-company-list\/\">PSU Company List India 2026: Maharatna, Navratna &amp; Miniratna<\/a><\/li>\n\n\n\n<li><a href=\"\/blog\/navratna-companies-in-india\/\">Navratna Companies in India 2026: Full List<\/a><\/li>\n<\/ul>\n<\/div><\/div>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"frequently-asked-questions-on-ltcg-tax\">Frequently Asked Questions on LTCG Tax<\/h2>\n\n\n<div id=\"rank-math-faq\" class=\"rank-math-block\">\n<div class=\"rank-math-list \">\n<div id=\"faq-question-1714627038856\" class=\"rank-math-list-item\">\n<h3 class=\"rank-math-question \"><strong>What is the LTCG tax rate in India in 2026?<\/strong><\/h3>\n<div class=\"rank-math-answer \">\n\n<p>The LTCG tax rate for listed equity shares and equity mutual funds is 12.5% on gains above \u20b91.25 lakh per financial year. For real estate, gold, and debt funds (pre-April 2023), the rate is also 12.5% but without the exemption or indexation benefit.<\/p>\n\n<\/div>\n<\/div>\n<div id=\"faq-question-1714627050673\" class=\"rank-math-list-item\">\n<h3 class=\"rank-math-question \"><strong>Is LTCG tax applicable on SIP returns?<\/strong><\/h3>\n<div class=\"rank-math-answer \">\n\n<p>Yes. Each SIP instalment is a separate purchase. If you redeem after holding each instalment for more than 12 months, the gains are LTCG taxed at 12.5%. If redeemed before 12 months, STCG at 20% applies.<\/p>\n\n<\/div>\n<\/div>\n<div id=\"faq-question-1714627065667\" class=\"rank-math-list-item\">\n<h3 class=\"rank-math-question \"><strong>What is the LTCG tax on property in 2026?<\/strong> <\/h3>\n<div class=\"rank-math-answer \">\n\n<p>Property sold after holding for more than 24 months attracts LTCG at 12.5%. Indexation benefit was removed in Budget 2024. So your entire capital gain (sale price minus original purchase price) is taxed at 12.5%.<\/p>\n\n<\/div>\n<\/div>\n<div id=\"faq-question-1714627088316\" class=\"rank-math-list-item\">\n<h3 class=\"rank-math-question \"><strong>Can LTCG losses be carried forward?<\/strong> <\/h3>\n<div class=\"rank-math-answer \">\n\n<p>Yes. Long-term capital losses can be carried forward for 8 assessment years and can only be set off against future LTCG, not against STCG or any other income.<\/p>\n\n<\/div>\n<\/div>\n<div id=\"faq-question-1714638938645\" class=\"rank-math-list-item\">\n<h3 class=\"rank-math-question \"><strong>What is the LTCG exemption limit in 2026?<\/strong> <\/h3>\n<div class=\"rank-math-answer \">\n\n<p>\u20b91.25 lakh per financial year for equity shares and equity mutual funds. This was increased from \u20b91 lakh in Budget 2024.<\/p>\n\n<\/div>\n<\/div>\n<div id=\"faq-question-1714638978261\" class=\"rank-math-list-item\">\n<h3 class=\"rank-math-question \"><strong>Is LTCG applicable on PPF, EPF, and NPS withdrawals?<\/strong> <\/h3>\n<div class=\"rank-math-answer \">\n\n<p>No. PPF and EPF withdrawals are fully tax-exempt. NPS withdrawals have their own tax treatment \u2014 60% of the corpus withdrawn at maturity is tax-free; 40% used for annuity is taxable as income.<\/p>\n\n<\/div>\n<\/div>\n<div id=\"faq-question-1714639031644\" class=\"rank-math-list-item\">\n<h3 class=\"rank-math-question \"><strong>What is LTCG tax on gold in 2026?<\/strong> <\/h3>\n<div class=\"rank-math-answer \">\n\n<p>Physical gold, gold ETFs, and gold funds held for more than 24 months attract LTCG at 12.5% without indexation benefit (as of Budget 2024).<\/p>\n\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n\n\n<p><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Understanding LTCG, Long Term Capital Gains Tax, is crucial for any investor. What exactly is LTCG? It's the tax applied to the profit gained from selling assets like stocks or real estate that have been held for a longer period, typically over a year. In 2026, knowing how LTCG can impact your investment returns and [&hellip;]<\/p>\n","protected":false},"author":4,"featured_media":14632,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[269],"tags":[426,425,427],"class_list":["post-6804","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-basics","tag-long-term-capital-gains-tax","tag-long-term-capital-gains-taxltcg-2024-calculation-rate","tag-ltcg-2024"],"_links":{"self":[{"href":"https:\/\/lakshmishree.com\/blog\/wp-json\/wp\/v2\/posts\/6804","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/lakshmishree.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/lakshmishree.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/lakshmishree.com\/blog\/wp-json\/wp\/v2\/users\/4"}],"replies":[{"embeddable":true,"href":"https:\/\/lakshmishree.com\/blog\/wp-json\/wp\/v2\/comments?post=6804"}],"version-history":[{"count":5,"href":"https:\/\/lakshmishree.com\/blog\/wp-json\/wp\/v2\/posts\/6804\/revisions"}],"predecessor-version":[{"id":14636,"href":"https:\/\/lakshmishree.com\/blog\/wp-json\/wp\/v2\/posts\/6804\/revisions\/14636"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/lakshmishree.com\/blog\/wp-json\/wp\/v2\/media\/14632"}],"wp:attachment":[{"href":"https:\/\/lakshmishree.com\/blog\/wp-json\/wp\/v2\/media?parent=6804"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/lakshmishree.com\/blog\/wp-json\/wp\/v2\/categories?post=6804"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/lakshmishree.com\/blog\/wp-json\/wp\/v2\/tags?post=6804"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}