Selling property or shares? Plan before you sign.
Since 23 July 2024, equity gains are taxed at 20% short-term and 12.5% long-term above ₹1.25 lakh, and indexation has gone for most assets — except that resident individuals and HUFs selling property bought before that date can pay the lower of 12.5% or 20% with indexation. From tax year 2026-27, buybacks are capital gains again, and the new Income-tax Act governs sales. We compute every option, plan Section 54, 54F and 54EC before the sale deed, and report under the right law.
- Holding period, rate and Act that apply to your sale
- Property: 12.5% vs 20%-with-indexation comparison
- Exemption plan: Section 54, 54F, 54EC, CGAS
- Loss set-off and carry-forward review
- Buyback, ESOP and unlisted-share gains
- Correct ITR schedules — and TDS for NRI sellers
Capital gains in 2026
Rates changed in July 2024, buyback rules changed again in 2026, and a new Income-tax Act took over on 1 April 2026. For property sellers, one choice — 12.5% or 20% with indexation — can move the tax by lakhs.
Rates since 23 July 2024:
- Listed equity (STT): STCG 20% · LTCG 12.5% above ₹1.25 lakh
- Other assets: long-term after 24 months at 12.5%, no indexation
- Debt funds bought from 1 Apr 2023: slab rates
Property option:
- Resident individual / HUF, bought before 23 Jul 2024:
- Lower of 12.5% without or 20% with indexation
- CII: 384 (FY 2026-27) · 376 (FY 2025-26)
2026 changes:
- Buybacks taxed as capital gains from tax year 2026-27
- Promoters: effective 22% / 30%
- Income-tax Act, 2025 governs sales from 1 Apr 2026
Exemptions:
- 54 / 54F (cap ₹10 Cr) · 54EC bonds ≤ ₹50 lakh in 6 months · CGAS
Talk to us if...
- You're selling a house, flat or land — and want to know whether 12.5% or 20% with indexation is cheaper, and how to reinvest to save tax
- You bought the property before 23 July 2024 and are a resident individual or HUF — you may be able to choose the lower of two computations
- You have large equity or mutual fund gains — timing, the ₹1.25 lakh exemption and loss set-off can change the tax materially
- You're receiving a share buyback — from tax year 2026-27 it's a capital gain again, with higher effective rates for promoters
- You hold ESOPs or unlisted shares, or are selling a business or a stake — cost, holding period and valuation need care
- You're an NRI selling Indian property — TDS, lower-deduction certificates and repatriation need planning
You may not need us if...
- Your gains are small and fully covered by the ₹1.25 lakh equity exemption — your regular ITR filing may be enough
- You've already received a notice about a past sale — see Income Tax Notice Reply
- You want tax avoided through circular or sham trades — we plan real transactions, not paper ones
- You're a trader in futures & options — that's business income, not capital gains (see ITR / accounting)
- The sale is years away and nothing is decided — come back when there's a buyer or a date
- You need a registered valuer's report — we coordinate one, but the valuer certifies
What our capital gains advice delivers
The right rate for every asset · the lower of two for property · exemptions planned before the sale · buybacks under 2026 rules · losses used, not wasted · the new Act handled.
The Right Rate for Every Asset
Since 23 July 2024, listed equity and equity-oriented funds (STT paid) are taxed at 20% short-term and 12.5% long-term above a single ₹1.25 lakh annual exemption; long-term means more than 12 months for listed securities and 24 months for most other assets. Indexation has gone for most assets. Debt funds bought from 1 April 2023 are taxed at slab rates regardless of holding. Getting the classification right is the first saving.
Property: The Lower of Two
For resident individuals and HUFs selling land or buildings acquired before 23 July 2024, tax is the lower of 12.5% without indexation or 20% with indexation. Which wins depends on when you bought and how prices moved. With the Cost Inflation Index at 384 for FY 2026-27 (376 for 2025-26), older properties often do better with indexation. Our calculator runs both.
Exemptions Planned Before the Sale
Section 54 (house to house) and 54F (other assets to a house) — deduction capped at ₹10 crore; 54EC bonds — up to ₹50 lakh, within 6 months, locked for 5 years. If you can't reinvest before the return is due, deposit in the Capital Gains Account Scheme. Each has timing and ownership conditions — planning before the sale deed is signed is what makes them work.
Buybacks Are Capital Gains Again
Budget 2026 reversed the 2024 treatment: from tax year 2026-27, buyback proceeds are taxed as capital gains on the profit only, not as dividend on the whole amount. Non-promoters pay the normal rates; promoters face effective rates of 22% (domestic company) or 30% (others). ESOP shares use the value at exercise as cost. We compute it correctly and plan participation.
Losses Used, Not Wasted
Short-term losses can be set off against any capital gains; long-term losses only against long-term gains. Unused losses carry forward for 8 years — but only if the return is filed on time. Harvesting losses and spreading equity sales across two years to use the ₹1.25 lakh exemption twice are simple, legitimate tools that are often missed.
The New Act, Handled
The Income-tax Act, 2025 applies to sales from 1 April 2026 (tax year 2026-27). The substance of capital-gains taxation continues, but section numbers and forms have changed. Sales in FY 2025-26 are reported under the 1961 Act. We report under the right law and schedule, and note that the ₹12-lakh rebate doesn't offset special-rate equity gains.
Coming soon: capital gains in 2 minutes
Holding periods → rates → the property option → exemptions → buybacks → losses → reporting under the right Act.
3-stage journey · Plan, execute, report
Red = before the deal. Gold = at and after the sale. Green = reporting on time. The first stage decides most of the tax.
Classify
Asset, holding period, rate, Act.
Compute
Both property methods; equity timing.
Plan
54 · 54F · 54EC · co-owners · NRI TDS.
54EC
Bonds up to ₹50 lakh.
CGAS
Deposit unspent amounts.
Report
Right Act, right schedule, losses kept.
6 eligibility scenarios
Documents for a capital gains review
Purchase and sale papers, investment statements, and reinvestment and status documents. Dates matter as much as amounts — they decide holding periods, rates and deadlines.
Purchase + Sale
- Purchase deed / allotment letter / broker contract notes
- Sale deed or agreement / sale contract notes
- Payment proofs for purchase and sale
- Stamp duty valuation (for property)
- Improvement bills (with dates)
- Brokerage and transfer costs
Investments
- Capital gains statements (brokers, AMCs)
- Demat holding statements
- ESOP grant, exercise and valuation letters
- Buyback offer letter and acceptance
- Carried-forward loss schedules (past ITRs)
- AIS / 26AS for the year
Reinvestment + Status
- New house purchase / construction documents
- 54EC bond certificates
- Capital Gains Account Scheme passbook
- Residential status details (NRIs)
- PAN / Aadhaar of all co-owners
- Valuation report (pre-2001 assets, unlisted shares)
12.5% without indexation or 20% with it?
Enter sale price, purchase cost and the financial year of purchase. For resident individuals and HUFs with property bought before 23 July 2024, the calculator runs both methods using the notified Cost Inflation Index and applies any Section 54 / 54F reinvestment and 54EC bonds. Tax shown before surcharge and cess.
Property sale · 12.5% without indexation vs 20% with indexation
Who can choose, how each is computed, and which tends to win — so you know what to expect before we run your numbers.
| Criteria | 12.5% · no indexation | 20% · with indexation | Which usually wins |
|---|---|---|---|
| Who can choose | Everyone | Resident individual / HUF only | Only if eligible for both |
| Property acquired | Any date | Before 23 July 2024 | Check the purchase date |
| Cost used | Actual cost | Cost × CII(sale) ÷ CII(purchase) | Indexed cost is higher |
| CII for sale in FY 2026-27 | — | 384 | Base 2001-02 = 100 |
| Bought long ago, modest rise | Higher gain | Much lower gain | Often 20% with indexation |
| Bought recently, sharp rise | Gain close to actual | Gain slightly lower | Often 12.5% |
| Pre-2001 property | FMV on 1 Apr 2001 as cost option | Same, then indexed | Valuation matters |
| Exemptions (54, 54F, 54EC) | Available | Available | Apply to either |
| Surcharge + cess | Extra | Extra | Compare on same basis |
| Documentation | Cost proof | Cost + purchase year | Keep both |
| NRIs | 12.5% | Not available | 12.5% applies |
| Companies / firms | 12.5% | Not available | 12.5% applies |
| Short-term (≤24 months) | Slab rates | Slab rates | Holding period first |
| Loss on indexed basis | — | Check before claiming | Take advice |
| Our calculator | Computes | Computes | Shows the lower |
| Our review | Confirms facts | Confirms facts | Plus exemption plan |
India capital gains map · 6 frameworks in one chart
Rates, the property option, buybacks, exemptions, losses and the new Act — in one view.
Plan, sell, reinvest, report · the 4-phase path
Phase 1: plan before the deal. Phase 2: execute the sale correctly. Phase 3: reinvest within the deadlines. Phase 4: report on time under the right Act.
Classify, compute, plan exemptions
Holding period, applicable rate and Act; for property, both computations; for equity, timing and loss harvesting. Exemption routes mapped with their deadlines — before the agreement is signed.
Exemptions depend on timing and ownership — plan before the sale deedDocumentation and TDS
Sale consideration vs stamp-duty value checked; TDS handled (including NRI sales and lower-deduction certificates); payment trail kept for every rupee.
NRI sellers: apply for a lower-deduction certificate in advance54EC bonds and reinvestment
54EC bonds within 6 months (up to ₹50 lakh); new house within the 54/54F windows; unspent amount deposited in the Capital Gains Account Scheme before the return is due.
Miss the CGAS deposit and the exemption for unspent money is lostReport correctly — and on time
Correct schedule under the right Act, exemptions claimed with evidence, losses carried forward. Filing on time preserves loss carry-forward.
Late return = no carry-forward of capital losses6 common capital gains mistakes — and how to avoid them
#1: planning exemptions after the sale. #2: not comparing 12.5% with 20%-with-indexation. #3: missing the Capital Gains Account Scheme. Plus late returns that lose losses, old buyback rules, and wrong holding periods.
Planning exemptions after the sale
Section 54, 54F and 54EC all have timing, ownership and investment conditions. Discovering them after the money is spent — or after 6 months for 54EC — is the most expensive capital-gains mistake.
Not comparing 12.5% with 20%-with-indexation
Resident individuals and HUFs selling property bought before 23 July 2024 can pay the lower of the two — but only if they compute both.
Missing the Capital Gains Account Scheme
If a new house isn't bought or built by the time the return is due, the unspent amount must be deposited in the Capital Gains Account Scheme — otherwise that part of the exemption is lost.
Late return, lost losses
Capital losses can be carried forward for eight years only if the return is filed by the due date. A late return quietly forfeits them.
Treating buybacks under old rules
Buyback treatment changed in October 2024 and again from tax year 2026-27. Using the wrong year's rules gives the wrong tax — and promoters face special effective rates.
Wrong holding period or asset class
Debt funds bought after 1 April 2023 taxed as long-term; unlisted shares treated as listed; the holding period counted from the wrong date for property. Each changes the rate.
Pick your plan
Computation and reporting from ₹5,000. Property Sale Advisory from ₹5,000 (recommended — plan before you sign). Buybacks, ESOPs, unlisted shares and business exits from ₹25,000.
- Classification, holding period and applicable Act
- Tax computation (both methods for property)
- Loss set-off and carry-forward review
- Equity timing and ₹1.25 lakh exemption use
- Correct ITR schedule reporting
- Written summary of the position
- Fee depends on number of transactions
- Everything in Capital Gains Review +
- Pre-sale exemption plan with deadlines
- Stamp-duty value vs consideration check
- 54EC bonds and CGAS guidance
- Co-owner and HUF allocation review
- NRI TDS and lower-deduction certificate
- Reinvestment tracking to the deadlines
- Documentation file for any future notice
- Pre-2001 or inherited property may need a valuer
- Buyback computation (incl. promoter rates)
- ESOP and unlisted-share gains
- Slump sale / business transfer structuring
- Valuation coordination
- Deal-term tax review
- Multi-year planning
- Complex transactions quoted individually
Prefer a call back?
Leave your number and a good time — we call within business hours (Mon–Sat, 10 am–7 pm) about Capital Gains Tax Advisory.
Tax desk · 10+ years of capital gains work
The Tax Paramarsh desk
"The biggest capital-gains savings are decided before the sale deed is signed — which exemption, in whose name, by when. For property bought before July 2024, comparing 12.5% with 20%-with-indexation can save lakhs on its own. And 2026 brought two more changes — buybacks back under capital gains, and a new Act. We compute every option and plan the paperwork so nothing is left to chance."
What clients say about our capital gains advice
Common questions
Straight answers on rates, indexation, buybacks, the new Act, exemptions, losses, NRIs and deadlines. Still curious? WhatsApp us.
What are the capital gains tax rates now?
- Listed equity and equity funds (STT paid): 20% if held 12 months or less; 12.5% above ₹1.25 lakh a year if held longer
- Property, gold, unlisted shares and most other assets: long-term after 24 months at 12.5% without indexation; short-term at slab rates
- Debt funds bought from 1 April 2023: slab rates
- Property bought before 23 July 2024 (resident individuals / HUFs): lower of 12.5% or 20% with indexation
These rates apply to transfers from 23 July 2024. Surcharge and cess are extra.
Should I use indexation on my property sale?
If you're a resident individual or HUF and bought the property before 23 July 2024, you can pay the lower of 12.5% without indexation or 20% with indexation. Indexed cost = purchase cost × CII of the sale year ÷ CII of the purchase year. The CII is 384 for FY 2026-27 and 376 for FY 2025-26 (base 2001-02 = 100). Older purchases with modest price rises usually favour indexation; recent purchases with sharp rises usually favour 12.5%. Use our calculator, then let us confirm with your documents.
How are share buybacks taxed now?
Budget 2026 changed the rules again. From tax year 2026-27, buyback proceeds are taxed as capital gains — on buyback price minus cost — instead of as dividend on the full amount. Non-promoters pay normal capital-gains rates. Promoters face effective rates of 22% if the promoter is a domestic company and 30% otherwise. For ESOP shares, the cost is generally the value taxed at exercise.
Does the new Income-tax Act change my capital gains?
The Income-tax Act, 2025 applies from 1 April 2026, so sales in tax year 2026-27 onwards fall under it. The substance of capital-gains taxation continues, with new section numbers and forms. Sales in FY 2025-26 are reported under the 1961 Act. Note that the ₹12-lakh rebate doesn't reduce tax on special-rate long-term equity gains — so tax can be payable even if your total income is under ₹12 lakh.
How can I save tax on a property sale?
- Section 54: reinvest long-term gain from a house in another house (deduction capped at ₹10 crore)
- Section 54F: reinvest net consideration from another long-term asset in a house (conditions on existing houses; capped at ₹10 crore)
- Section 54EC: invest up to ₹50 lakh in specified bonds within 6 months; 5-year lock-in
- Capital Gains Account Scheme: deposit unspent amounts before the return due date
Each has time limits and conditions; the new Act carries equivalent provisions under new numbers. Plan before the sale deed.
What do your services cost?
- Capital Gains Review: from ₹5,000 — computation, classification, losses, correct reporting
- Property Sale Advisory: from ₹5,000 — pre-sale exemption plan, TDS and reinvestment tracking
- Stake & Exit Advisory: from ₹25,000 — buybacks, ESOPs, unlisted shares, business sales
Can capital losses reduce my tax?
Yes. Short-term capital losses can be set off against short- or long-term gains; long-term losses only against long-term gains. Unused losses carry forward for 8 years — but only if your return is filed by the due date. Booking real losses before year-end to offset gains is legitimate; circular or sham trades are not.
I'm an NRI selling property in India. What should I know?
The buyer must deduct TDS on the capital gain (plus surcharge and cess), which is often far above the actual tax if you have indexation, exemptions or losses. Apply for a lower-deduction certificate before the sale. NRIs are taxed at 12.5% on long-term gains without the indexation option. Repatriation needs the right certificates. Treaty provisions may also matter.
When should I talk to you?
Before you sign — ideally before agreeing the price and structure. Exemption routes, co-owner allocations, TDS certificates and valuation all work best in advance. After the sale, we can still compute, claim what's available and report correctly.
What are the key deadlines after a sale?
- 54EC bonds: within 6 months of the transfer
- Section 54 / 54F: buy within 1 year before or 2 years after, or build within 3 years
- Capital Gains Account Scheme: deposit before the return due date
- Return: file by the due date to keep loss carry-forward
- Advance tax: gains may require advance tax in the quarter they arise
What if I bought the property before 2001?
For assets acquired before 1 April 2001, you can generally take the higher of actual cost or the fair market value on 1 April 2001 as cost (for land and buildings, capped at the stamp-duty value on that date). A registered valuer's report is usually needed. If indexation is available, it then runs from the 2001-02 base.
Do I need to report gains even if no tax is due?
Yes. Capital gains must be reported in the right schedule even if covered by exemptions or the ₹1.25 lakh threshold. Mismatches with AIS — which shows your sales — are a common trigger for notices.
Talk to us before you sign.
WhatsApp us what you're selling, when you bought it and the expected price. Free 30-minute review: the applicable rate, whether indexation helps, which exemptions fit and their deadlines. Capital Gains Review from ₹5,000. Property Sale Advisory from ₹5,000. Stake & Exit Advisory from ₹25,000.