The pivot date is 23 July 2024. Anything sold on or after it follows the new regime. Two Budgets have passed since without changing these core rules, so this is the settled picture, not a moving target.

Equity: simpler, and a bit dearer

For listed shares and equity mutual funds, the long-term holding period stays at 12 months. Sell after that and the gain is long-term, taxed at 12.5% on the amount above a ₹1.25 lakh yearly exemption, a flat 12.5% without indexation. Sell within 12 months and it is short-term, now taxed at 20%, up from 15%. So the long-term rate rose from 10% to 12.5%, the exemption rose from ₹1 lakh to ₹1.25 lakh, and short-term selling got dearer. The message is unchanged but louder: holding past a year matters.

A quick illustration. Say you have ₹3 lakh of long-term equity gains in a year. The first ₹1.25 lakh is exempt, leaving ₹1.75 lakh taxed at 12.5%, about ₹21,900. Spread the same selling across two financial years and you use the exemption twice, cutting the taxable gain to ₹50,000 and the tax to roughly ₹6,250. Same asset, same total gain, less than a third of the tax, purely from timing.

Debt and gold: know your dates

Debt funds are the trap. Units of most debt funds bought on or after 1 April 2023 are taxed at your slab rate regardless of how long you hold them, with no long-term benefit at all. Units bought before that date and sold after July 2024 get 12.5% without indexation. The date of purchase decides everything.

The debt change also erased the old reason many people preferred debt funds over fixed deposits, which was the tax edge. With most debt-fund gains now taxed at slab rate like FD interest, the choice comes down to liquidity and convenience rather than tax, a genuinely different calculation from a few years ago.

For gold, the split is by form. A listed gold ETF reaches long-term status in 12 months and is taxed at 12.5%. Physical gold, digital gold, and gold funds are unlisted, so they need 24 months to qualify, at the same 12.5% rate. Same metal, different clocks.

Property: the one place indexation survives

Property is where the change bites hardest and where a valuable exception remains. Sell a property held over 24 months and the default is 12.5% without indexation. But if you bought it before 23 July 2024, resident individuals and HUFs can instead choose 20% with indexation, whichever produces the lower tax. For older properties with large paper gains, the 20% indexed option often wins by a wide margin. For recent purchases or modest gains, the flat 12.5% usually does. This is a genuine choice, and getting it wrong can cost lakhs.

Take a flat bought in 2015 for ₹50 lakh and sold now for ₹90 lakh. Without indexation the gain is ₹40 lakh, taxed at 12.5%, about ₹5 lakh. With indexation the cost steps up for inflation to roughly ₹72 lakh, the gain shrinks to about ₹18 lakh, and 20% of that is around ₹3.7 lakh. The older and larger the gain, the more the indexed option tends to win.

What to actually do differently

A few concrete shifts. Time your equity sales across financial years to use the ₹1.25 lakh exemption more than once, and to stay past the 12-month line. Check your debt-fund purchase dates before assuming any long-term benefit exists, because for most recent units there is none. Prefer gold ETFs over physical gold if tax efficiency matters, given the shorter 12-month clock. And on any property sale, run both methods before you file, since the indexation option is easy to miss and expensive to forget.

The rules got simpler. The planning got more important. With indexation gone from most assets, the timing of a sale, not just the fact of it, now drives the tax you pay.

One more lever: capital losses. Short-term losses can offset both short and long-term gains, long-term losses only long-term gains, and unused losses carry forward for eight years if you file your return on time. Booking a loss deliberately to offset a gain in the same year is a legitimate way to lower the bill that most individual investors never use.

Where this leaves you

The new regime rewards patience and punishes carelessness. Most of the tax you can still save comes not from clever products but from when you choose to sell and which option you elect.

Frequently asked questions

What is the LTCG tax on mutual funds now?
For equity mutual funds held over 12 months, long-term gains are taxed at 12.5% above a ₹1.25 lakh annual exemption. For most debt funds bought on or after 1 April 2023, gains are taxed at your slab rate regardless of holding period.
What is the short-term capital gains tax in India?
On listed shares and equity funds sold within 12 months, it is 20%, up from 15%. On property, gold, and debt funds, short-term gains are added to income and taxed at your slab rate.
Can I still get indexation on property?
Only if you are a resident individual or HUF and bought the property before 23 July 2024. You can then choose 20% with indexation or 12.5% without, whichever is lower. Newer purchases get 12.5% without indexation only.
Did Budget 2025 or 2026 change these rules?
No. The core capital gains rates and holding periods set by the July 2024 changes have carried through both Budgets unchanged, so the current picture is stable for now.
How is capital gains tax on shares in India calculated?
Gain is sale price minus cost. If held over 12 months it is long-term at 12.5% above ₹1.25 lakh; within 12 months it is short-term at 20%. Indexation no longer applies to listed shares. This article is for information only and is not investment or tax advice. Rates and rules referred to here apply to FY 2025-26 and can change in future Budgets. Please speak to a qualified adviser before acting. Sources for figures: the Finance (No. 2) Act 2024 and Income Tax Department guidance, as applicable for FY 2025-26. Verified July 2026.

If you are sitting on gains across equity, property, or old debt holdings, SELEQT can run the numbers on your holdings before you sell rather than after you have filed.