{"id":12215,"date":"2026-05-22T13:38:56","date_gmt":"2026-05-22T13:38:56","guid":{"rendered":"https:\/\/lemonn.co.in\/blog\/glossary\/ltcg-tax\/"},"modified":"2026-05-22T13:38:56","modified_gmt":"2026-05-22T13:38:56","slug":"ltcg-tax","status":"publish","type":"glossary","link":"https:\/\/lemonn.co.in\/blog\/glossary\/ltcg-tax\/","title":{"rendered":"LTCG Tax"},"content":{"rendered":"<p>Long-Term <a class=\"glossaryLink\" href=\"https:\/\/lemonn.co.in\/blog\/glossary\/capital-gain\/\" data-gt-translate-attributes='[{\"attribute\":\"data-cmtooltip\", \"format\":\"html\"}]' tabindex=\"0\" role=\"link\">Capital Gain<\/a>s, or LTCG, refers to profit earned from selling an asset held for longer than a specified holding period. India <a class=\"glossaryLink\"  href=\"https:\/\/lemonn.co.in\/blog\/glossary\/tax\/\"  data-gt-translate-attributes='[{\"attribute\":\"data-cmtooltip\", \"format\":\"html\"}]'  tabindex='0' role='link'>tax<\/a>es LTCG differently across asset classes, with the most prominent being <a class=\"glossaryLink\"  href=\"https:\/\/lemonn.co.in\/blog\/glossary\/equity\/\"  data-gt-translate-attributes='[{\"attribute\":\"data-cmtooltip\", \"format\":\"html\"}]'  tabindex='0' role='link'>equity<\/a> LTCG at 10% above &#8377;1 lakh per year. Understanding LTCG rules is essential for tax-efficient investing in equity, <a class=\"glossaryLink\" href=\"https:\/\/lemonn.co.in\/blog\/glossary\/mutual-fund\/\" data-gt-translate-attributes='[{\"attribute\":\"data-cmtooltip\", \"format\":\"html\"}]' tabindex=\"0\" role=\"link\">mutual fund<\/a>s, debt, gold and real estate.<\/p>\n<div><strong>Key takeaways:<\/strong>\n<ul>\n<li>LTCG applies if you hold the asset longer than the prescribed period &mdash; 12 months for listed equity\/equity MF, 24 months for property and unlisted <a class=\"glossaryLink\"  href=\"https:\/\/lemonn.co.in\/blog\/glossary\/shares\/\"  data-gt-translate-attributes='[{\"attribute\":\"data-cmtooltip\", \"format\":\"html\"}]'  tabindex='0' role='link'>shares<\/a>, 36 months for debt MFs (older units).<\/li>\n<li>Equity\/equity MF <a class=\"glossaryLink\"  href=\"https:\/\/lemonn.co.in\/blog\/glossary\/ltcg-tax\/\"  data-gt-translate-attributes='[{\"attribute\":\"data-cmtooltip\", \"format\":\"html\"}]'  tabindex='0' role='link'>LTCG tax<\/a>ed at 10% (above &#8377;1 lakh annual exemption).<\/li>\n<li>Property LTCG at 20% with <a class=\"glossaryLink\" href=\"https:\/\/lemonn.co.in\/blog\/glossary\/indexation\/\" data-gt-translate-attributes='[{\"attribute\":\"data-cmtooltip\", \"format\":\"html\"}]' tabindex=\"0\" role=\"link\">indexation<\/a>; new rules also offer a 12.5% option without <a class=\"glossaryLink\"  href=\"https:\/\/lemonn.co.in\/blog\/glossary\/index\/\"  data-gt-translate-attributes='[{\"attribute\":\"data-cmtooltip\", \"format\":\"html\"}]'  tabindex='0' role='link'>index<\/a>ation.<\/li>\n<li>Debt MF gains after 1 April 2023 are fully taxed at slab rate, regardless of holding period.<\/li>\n<li>Bring-forward of LTCG losses allowed against future capital gains for 8 years.<\/li>\n<\/ul>\n<\/div>\n<h2 id=\"holding-period-thresholds\">Holding-period thresholds<\/h2>\n<table>\n<tr>\n<th>Asset<\/th>\n<th>LTCG holding period<\/th>\n<\/tr>\n<tr>\n<td>Listed equity \/ equity MF<\/td>\n<td>12 months<\/td>\n<\/tr>\n<tr>\n<td>Unlisted shares<\/td>\n<td>24 months<\/td>\n<\/tr>\n<tr>\n<td>Immovable property<\/td>\n<td>24 months<\/td>\n<\/tr>\n<tr>\n<td>Debt MF (older units)<\/td>\n<td>36 months<\/td>\n<\/tr>\n<tr>\n<td>Gold \/ <a class=\"glossaryLink\" href=\"https:\/\/lemonn.co.in\/blog\/glossary\/sovereign-gold-bonds\/\" data-gt-translate-attributes='[{\"attribute\":\"data-cmtooltip\", \"format\":\"html\"}]' tabindex=\"0\" role=\"link\">sovereign gold bonds<\/a><\/td>\n<td>24 months<\/td>\n<\/tr>\n<\/table>\n<h2 id=\"equity-ltcg-most-important-for-investors\">Equity LTCG &#x2014; most important for investors<\/h2>\n<p>On listed <a class=\"glossaryLink\" href=\"https:\/\/lemonn.co.in\/blog\/glossary\/equity-shares\/\" data-gt-translate-attributes='[{\"attribute\":\"data-cmtooltip\", \"format\":\"html\"}]' tabindex=\"0\" role=\"link\">equity shares<\/a> and equity <a class=\"glossaryLink\" href=\"https:\/\/lemonn.co.in\/blog\/glossary\/mutual-fund-units\/\" data-gt-translate-attributes='[{\"attribute\":\"data-cmtooltip\", \"format\":\"html\"}]' tabindex=\"0\" role=\"link\">mutual fund units<\/a> sold after 12 months, gains above &#x20B9;1 lakh per financial year are taxed at 10% (plus surcharge and cess). The &#x20B9;1 lakh exemption is per individual, per year. Use this exemption proactively &#x2014; sell and re-buy small lots near year-end if your overall <a class=\"glossaryLink\" href=\"https:\/\/lemonn.co.in\/blog\/glossary\/portfolio\/\" data-gt-translate-attributes='[{\"attribute\":\"data-cmtooltip\", \"format\":\"html\"}]' tabindex=\"0\" role=\"link\">portfolio<\/a> allows.<\/p>\n<h2 id=\"property-ltcg\">Property LTCG<\/h2>\n<p>For immovable property held over 24 months, you have two options (from FY2024&#x2013;25):<\/p>\n<ul>\n<li>20% on indexed gains (cost adjusted for <a class=\"glossaryLink\" href=\"https:\/\/lemonn.co.in\/blog\/glossary\/inflation\/\" data-gt-translate-attributes='[{\"attribute\":\"data-cmtooltip\", \"format\":\"html\"}]' tabindex=\"0\" role=\"link\">inflation<\/a> via CII).<\/li>\n<li>12.5% on un-indexed gains (simpler, may benefit some).<\/li>\n<\/ul>\n<p>You can also reinvest under Sections 54 \/ 54EC \/ 54F to defer tax. Choose the route that minimises tax based on your situation.<\/p>\n<h2 id=\"debt-mutual-funds-the-2023-change\">Debt mutual funds &#x2014; the 2023 change<\/h2>\n<p>For units bought on or after 1 April 2023, debt mutual fund gains are taxed at slab rate regardless of holding period &#x2014; there is no LTCG benefit. Older units retain the previous LTCG treatment (20% with indexation after 36 months). This is a major change for debt-fund investors and has shifted preferences toward Target Maturity Funds and tax-efficient alternatives.<\/p>\n<h2 id=\"loss-set-off-and-carry-forward\">Loss set-off and carry-forward<\/h2>\n<ul>\n<li>Long-term capital losses can be set off only against long-term capital gains.<\/li>\n<li>Short-term capital losses can be set off against both long-term and short-term gains.<\/li>\n<li>Unutilised losses can be carried forward for 8 assessment years.<\/li>\n<li>File ITR by due date to retain carry-forward eligibility.<\/li>\n<\/ul>\n<h2 id=\"smart-ltcg-tax-planning\">Smart LTCG tax planning<\/h2>\n<ol>\n<li>Use the &#x20B9;1 lakh equity LTCG exemption each year &#x2014; &#x201C;tax loss harvesting in reverse&#x201D;.<\/li>\n<li>Stagger redemptions across financial years to spread gains.<\/li>\n<li>Pair LTCG harvesting with rebalancing for two benefits in one transaction.<\/li>\n<li>Track holding period dates carefully &#x2014; selling one day too early flips the asset into short-term territory.<\/li>\n<li>Document the cost basis for inherited or gifted <a class=\"glossaryLink\"  href=\"https:\/\/lemonn.co.in\/blog\/glossary\/assets\/\"  data-gt-translate-attributes='[{\"attribute\":\"data-cmtooltip\", \"format\":\"html\"}]'  tabindex='0' role='link'>assets<\/a> to calculate gains correctly.<\/li>\n<\/ol>\n<h2 id=\"frequently-asked-questions\">Frequently asked questions<\/h2>\n<div>\n<h3 id=\"is-the-&#x20B9;1-lakh-equity-ltcg-exemption-per-holding-or-per-total\">Is the &#x20B9;1 lakh equity LTCG exemption per holding or per total?<\/h3>\n<p>Per individual per financial year, across all equity\/equity-MF gains combined.<\/p>\n<h3 id=\"are-sgbs-taxed-on-maturity\">Are SGBs taxed on maturity?<\/h3>\n<p>Sovereign Gold <a class=\"glossaryLink\"  href=\"https:\/\/lemonn.co.in\/blog\/glossary\/bonds\/\"  data-gt-translate-attributes='[{\"attribute\":\"data-cmtooltip\", \"format\":\"html\"}]'  tabindex='0' role='link'>Bonds<\/a> redeemed at maturity are entirely tax-exempt; sold before maturity, normal LTCG\/STCG rules apply.<\/p>\n<h3 id=\"do-nris-pay-ltcg-tax-in-india\">Do NRIs pay LTCG tax in India?<\/h3>\n<p>Yes, on Indian-sourced gains. <a class=\"glossaryLink\"  href=\"https:\/\/lemonn.co.in\/blog\/glossary\/tds\/\"  data-gt-translate-attributes='[{\"attribute\":\"data-cmtooltip\", \"format\":\"html\"}]'  tabindex='0' role='link'>TDS<\/a> applies; treaty benefits may reduce overall tax burden.<\/p>\n<h3 id=\"how-is-ltcg-reported\">How is LTCG reported?<\/h3>\n<p>On Schedule CG of the ITR. <a class=\"glossaryLink\"  href=\"https:\/\/lemonn.co.in\/blog\/glossary\/broker\/\"  data-gt-translate-attributes='[{\"attribute\":\"data-cmtooltip\", \"format\":\"html\"}]'  tabindex='0' role='link'>Broker<\/a>s and AMCs provide capital-gain statements for the year.<\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>Long-Term Capital Gains, or LTCG, refers to profit earned from selling an asset held for longer than a specified holding period. India taxes LTCG differently across asset classes, with the most prominent being equity LTCG at 10% above &#x20B9;1 lakh per year. Understanding LTCG rules is essential for tax-efficient investing in equity, mutual funds, debt, [&#x2026;]<\/p>\n","protected":false},"author":3,"featured_media":0,"menu_order":0,"template":"","meta":{"_uag_custom_page_level_css":"","footnotes":""},"class_list":["post-12215","glossary","type-glossary","status-publish","hentry"],"blocksy_meta":[],"uagb_featured_image_src":{"full":false,"thumbnail":false,"medium":false,"medium_large":false,"large":false,"1536x1536":false,"2048x2048":false,"web-stories-poster-portrait":false,"web-stories-publisher-logo":false,"web-stories-thumbnail":false},"uagb_author_info":{"display_name":"Ashutosh","author_link":"https:\/\/lemonn.co.in\/blog\/author\/ashu\/"},"uagb_comment_info":0,"uagb_excerpt":"Long-Term Capital Gains, or LTCG, refers to profit earned from selling an asset held for longer than a specified holding period. India taxes LTCG differently across asset classes, with the most prominent being equity LTCG at 10% above &#x20B9;1 lakh per year. Understanding LTCG rules is essential for tax-efficient investing in equity, mutual funds, debt,&hellip;","_links":{"self":[{"href":"https:\/\/lemonn.co.in\/blog\/wp-json\/wp\/v2\/glossary\/12215","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/lemonn.co.in\/blog\/wp-json\/wp\/v2\/glossary"}],"about":[{"href":"https:\/\/lemonn.co.in\/blog\/wp-json\/wp\/v2\/types\/glossary"}],"author":[{"embeddable":true,"href":"https:\/\/lemonn.co.in\/blog\/wp-json\/wp\/v2\/users\/3"}],"version-history":[{"count":0,"href":"https:\/\/lemonn.co.in\/blog\/wp-json\/wp\/v2\/glossary\/12215\/revisions"}],"wp:attachment":[{"href":"https:\/\/lemonn.co.in\/blog\/wp-json\/wp\/v2\/media?parent=12215"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}