A Capital Gains Tax Calculator is an easy tool that helps you calculate taxes on profits from selling assets like property, stocks, or mutual funds. It works for both short-term and long-term capital gains under Income Tax Act 1961. It is a quick and simple way to plan your taxes and make better financial decisions. Let us learn about a Capital Gains Calculator in detail.
A Capital Gains Tax Calculator is a useful online tool that simplifies the complex process of estimating the tax on profits made from selling assets like stocks, real estate, ULIP funds, or other capital investments.
The capital gains calculator simplifies tax calculations, saving time and reducing errors. It also includes provisions for indexation benefits and exemptions under Income Tax laws of India.
Follow the steps mentioned below to use a capital gains tax calculator:
Step 1: Select the Type of Asset: Choose the asset type, such as property, stocks, mutual funds, or other investments.
Step 2: Insert Purchase Details: Â Enter the purchase price and purchase date of the asset.
Step 3: Provide Sale Details: Â Fill in the sale price and sale date.
Step 4: Include Expenses and Exemptions: Add any associated costs like brokerage fees or improvement expenses. Include eligible exemptions like Section 80CCF, Section 54, or Section 80C, if any.
Step 5: Adjust for Indexation (if applicable): For long-term assets, insert the Cost Inflation Index (CII) to adjust the purchase price.
Step 7: Get Results: The calculator will display your capital gains amount and applicable tax liability.
A capital gains tax calculator provides you with the following benefits:
Accurate Tax Calculation: Helps compute exact capital gains tax on profits from the sale of assets like property, stocks, or bonds.
Saves Time: Quickly calculates tax amounts, eliminating manual calculations and reducing errors.
Supports Both Short and Long-Term Gains: Differentiates between short-term and long-term capital gains based on the holding period.
Incorporates Latest Tax Laws: Updated to reflect 2024 tax rules, exemptions, and rates.
User-Friendly: Simple interface that even non-experts can use easily.
Optimizes Financial Decisions: Assists in deciding the best time to sell assets to minimize tax.
Free and Widely Accessible: The capital gains calculator is available online for free, ensuring easy access for all.
Capital gains are the profits earned from selling a capital asset, such as property, stocks, bonds, or mutual funds. In India, capital gains are taxed under the Income Tax Act based on the type of gain:
Short-term Capital Gains (STCG): These are gains arising from the sale of assets within a short holding period. This period is usually less than 12 months.
Long-term Capital Gains (LTCG): These are gains arising from the sale of assets held for a longer period of time before sale. This long-term period is 12, 24, or 36 months, depending on the type of asset.Â
Let us learn the capital gains tax rates for various investments from the table mentioned below:
Type of Income | Nature of Income | Rate of Tax | Holding Period |
Long-Term Capital Gain | From equity shares listed on Indian stock exchanges, equity-oriented mutual funds, units of business trusts, zero-coupon bonds | 12.5% (if the total gain exceeds â‚ą1.25 lakh annually) | > 1 year |
From unlisted shares and securities (other than bonds/debentures) and foreign exchange assets | 12.5% | > 2 years | |
From unlisted debentures and bonds (Taxed as Short-Term Capital Gains) | 20% | ≤ 2 years | |
From property | 20% (with inflation indexation), OR 12.5% (without indexation) | > 2 years | |
Any other capital gain | 12.5%-20% (depends on asset type) | Varies | |
Short-Term Capital Gain | From equity shares listed on Indian stock exchanges, equity-oriented mutual funds, units of business trusts | 20% | ≤ 1 year |
From other assets | Taxed as per income tax slab | ≤ 1 year | |
Normal Income | Any income from investments like interest, dividends, etc. | Taxed as per income tax slab | N/A |
A Capital Gains Tax Calculator is a useful tool to calculate taxes on profits from selling capital assets. It makes tax calculation easy and accurate by using the latest tax rules. You just need to enter details like the purchase price, sale price, and holding period to get the tax amount. It helps you save time, avoid mistakes, and plan your taxes better. Use it to stay prepared and file your taxes hassle-free.
†Policybazaar does not endorse, rate or recommend any particular insurer or insurance product offered by any insurer. This list of plans listed here comprise of insurance products offered by all the insurance partners of Policybazaar. The sorting is based on past 10 years’ fund performance (Fund Data Source: Value Research). For a complete list of insurers in India refer to the Insurance Regulatory and Development Authority of India website, www.irdai.gov.in
*All savings are provided by the insurer as per the IRDAI approved insurance plan.
^The tax benefits under Section 80C allow a deduction of up to ₹1.5 lakhs from the taxable income per year and 10(10D) tax benefits are for investments made up to ₹2.5 Lakhs/ year for policies bought after 1 Feb 2021. Tax benefits and savings are subject to changes in tax laws.
¶Long-term capital gains (LTCG) tax (12.5%) is exempted on annual premiums up to 2.5 lacs.
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