How do you use the capital gains tax calculator?
- Enter the sale price, what you paid, and the purchase and sale dates.
- Choose the seller: a resident individual or HUF, or a non-resident, firm or company.
- Read the tax. Buying and selling costs, improvements, your slab rate, surcharge and any exemption are under “Adjust costs, improvements and tax rates”.
The calculator decides whether the gain is short-term or long-term from the dates, and where the law lets you choose, it works out both methods and uses the lower tax.
How is capital gains tax on property worked out?
Property held for more than 24 months gives a long-term gain; anything shorter is short-term and is added to your income at your slab rate. The gain is the sale price less selling costs, less what you paid including stamp duty and registration, less any improvements.
Long-term gains are taxed at 12.5% without indexation. A resident individual or HUF selling land or a building bought before 23 July 2024 can instead pay 20% on the indexed gain, if that is lower. Indexation raises the cost by the cost inflation index (CII) from the year of purchase to the year of sale; improvements are raised from the year they were made. The indexed figure only limits the tax; it cannot create a loss. Non-residents, firms and companies pay 12.5% without indexation. A 4% health and education cess is added to the tax, and surcharge if your income attracts it. Since 1 April 2026 these rules sit in section 197 of the Income-tax Act, 2025.
How the tax is worked out
Sale − selling costs − (cost + buying costs) − improvementsCost × CII of sale year ÷ CII of purchase year (2001-02 if earlier)12.5% × step 1, or 20% × indexed gain if allowed and lowerStep 3 × (1 + surcharge) × 1.04 cessWorked example: bought 2015, sold 2026
A flat bought on 15 June 2015 for ₹ 50,00,000 plus ₹ 2,00,000 of buying costs, with ₹ 3,00,000 of improvements in August 2018, is sold on 1 October 2026 for ₹ 90,00,000 less ₹ 2,00,000 of brokerage. The gain is ₹ 33,00,000, and 12.5% of it is ₹ 4,12,500. With indexation, the cost becomes ₹ 78,61,417 (CII 254 to 384) and the improvements ₹ 4,11,429 (CII 280 to 384), leaving an indexed gain of ₹ 5,27,154 and tax at 20% of ₹ 1,05,431. The resident seller pays the lower figure: ₹ 1,09,648 with cess. A non-resident selling the same flat pays ₹ 4,29,000.
Worked example: short-term and recent purchases
Bought on 10 January 2025 for ₹ 75,00,000 and sold on 1 October 2026, the flat was held for less than 24 months. The gain of ₹ 11,00,000 is taxed at a 30% slab rate: ₹ 3,43,200 with cess. Bought on 1 September 2024 for ₹ 70,00,000 instead, the gain is long-term, but indexation is not available because the purchase came after 23 July 2024, so the tax is ₹ 2,08,000.
What is the cost inflation index?
| FY | CII | FY | CII |
|---|---|---|---|
| 2001-02 | 100 | 2014-15 | 240 |
| 2002-03 | 105 | 2015-16 | 254 |
| 2003-04 | 109 | 2016-17 | 264 |
| 2004-05 | 113 | 2017-18 | 272 |
| 2005-06 | 117 | 2018-19 | 280 |
| 2006-07 | 122 | 2019-20 | 289 |
| 2007-08 | 129 | 2020-21 | 301 |
| 2008-09 | 137 | 2021-22 | 317 |
| 2009-10 | 148 | 2022-23 | 331 |
| 2010-11 | 167 | 2023-24 | 348 |
| 2011-12 | 184 | 2024-25 | 363 |
| 2012-13 | 200 | 2025-26 | 376 |
| 2013-14 | 220 | 2026-27 | 384 |
What else should you check before selling?
- If the stamp duty value of the property is more than 110% of the sale price, the stamp duty value is taken as the sale price for tax.
- For property bought before 1 April 2001, the cost can be its fair market value on that date, capped at the stamp duty value then. Enter that value as the cost.
- Reinvesting the gain in another house, or in specified bonds within six months, can reduce the tax. The limits, time windows and lock-ins are strict, so plan them with your CA before the sale.
- The buyer deducts 1% TDS from a resident seller when the price is ₹ 50 lakh or more. You claim it against the tax in your return.
Frequently asked questions
Related answers and guides
- When Property Tax Starts on a New Bengaluru Flat
- Home Loan Tax Benefit Under the Income-tax Act 2025
- Capital Gains Tax on Sale of Flat: Bengaluru 2026 Rules
- Capital Gains Exemption on Sale of House: 2026 Upgrade Rules
Sources
- Income Tax Department, Capital gains: holding period, 12.5% rate, choice of 20% with indexation for residents on property bought before 23 July 2024.
- Income Tax Department, Cost inflation index; CBDT Notification 85/2026 (15 July 2026) for 2026-27.
- Income-tax Act, 2025, section 197, in force from 1 April 2026. Rules checked 19 Oct 2026.
Indicative only. Tax depends on your full income, surcharge, exemptions and the facts of the sale. Please verify with your Chartered Accountant before acting.
Selling a home in Bengaluru? Talk to an acre&key advisor.