Short term capital gains tax on stocks and mutual funds for FY 2025-26. Equity shares and equity MFs sold within 12 months are taxed at 20%. Other assets use income slab rates.
Short term capital gains on listed equity shares and equity mutual funds sold within 12 months are taxed at a flat 20% (plus 4% health and education cess), regardless of your income slab. There is no ₹1.25L exemption for STCG — the full gain is taxable from rupee one.
For other assets (debt mutual funds, unlisted shares, property), STCG is added to your total income and taxed at your applicable income tax slab rate.
| Feature | STCG (equity) | LTCG (equity) |
|---|---|---|
| Holding period | Under 12 months | Over 12 months |
| Tax rate | 20% | 12.5% |
| ₹1.25L exemption | No | Yes — per financial year |
| Grandfathering | Not applicable | Available for pre-Feb 2018 shares |
| Cess | 4% on tax amount | 4% on tax amount |
| Strategy | Defer sale past 12 months to save 7.5% | Book ₹1.25L of gains every March |