When does LTCG kick in for equity?

Listed equity / equity MF: held > 12 months → LTCG 12.5% on gains > ₹1.25L. Unlisted equity / debt MF / property: held > 24 months → LTCG (rates vary). Below threshold: STCG.

STCG losses: against any STCG or LTCG within same year. LTCG losses: ONLY against LTCG. Carry forward 8 years. F&O loss is non-speculative business loss (separate rules).

Should I harvest the ₹1.25L LTCG annually?

Yes — sell + immediately rebuy equity worth up to ₹1.25L gains/year to reset cost basis tax-free. Saves ₹15K/year tax (12.5% × ₹1.25L). Common 'tax harvesting' practice in Mar/Apr.

Real estate post-Jul 2024 sale?

12.5% flat (no indexation). Pre-2024 properties get grandfathered 20%-with-indexation OR 12.5%-without (taxpayer's choice). Section 54 reinvestment exemption still applies.

Tax · Equity tax explained

LTCG & STCG Capital Gains

After Budget 2024-25, capital gains rates changed materially: STCG on equity rose 15% → 20%, LTCG on equity rose 10% → 12.5% (with ₹1.25L exemption), and indexation benefit was REMOVED for debt MFs (post-Apr 2023) and real estate (post-Jul 2024). Holding-period definition matters: 12 months for listed equity, 24 months for unlisted, 24 months for property.

Shivpriya·Editor·Updated May 18, 2026·Fact-checked

Who needs this

Anyone selling equity, mutual funds, real estate, gold, crypto, or unlisted shares. Mandatory disclosure in ITR-2/ITR-3 (not ITR-1). Loss-set-off rules require careful tracking.

Key dates

LTCG harvesting windowBest done Feb-Mar each FY
ITR-2/ITR-3 filingJul 31, 2026
Section 54/54F reinvestment2 yr (purchase) / 3 yr (construction)

Key decisions

Q1
When does LTCG kick in for equity?
Listed equity / equity MF: held > 12 months → LTCG 12.5% on gains > ₹1.25L. Unlisted equity / debt MF / property: held > 24 months → LTCG (rates vary). Below threshold: STCG.
Q2
Can I offset losses?
STCG losses: against any STCG or LTCG within same year. LTCG losses: ONLY against LTCG. Carry forward 8 years. F&O loss is non-speculative business loss (separate rules).
Q3
Should I harvest the ₹1.25L LTCG annually?
Yes — sell + immediately rebuy equity worth up to ₹1.25L gains/year to reset cost basis tax-free. Saves ₹15K/year tax (12.5% × ₹1.25L). Common 'tax harvesting' practice in Mar/Apr.
Q4
Real estate post-Jul 2024 sale?
12.5% flat (no indexation). Pre-2024 properties get grandfathered 20%-with-indexation OR 12.5%-without (taxpayer's choice). Section 54 reinvestment exemption still applies.

CBDT rules + tax-act references

Equity STCG: 20% (was 15% pre-Jul 2024).
Equity LTCG: 12.5% on gains > ₹1.25L (was 10% on gains > ₹1L pre-Jul 2024).
Debt MF (post-Apr 2023): no indexation, taxed at slab rate as STCG regardless of holding period.
Property (post-Jul 2024): 12.5% flat. Pre-2024: choice between 20%-indexed or 12.5%-unindexed.
F&O: business income, slab rate, audit if turnover > thresholds.

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