Short-term capital gains (STCG)

A short-term capital gain is the profit on listed shares sold within 12 months of buying them. Since 23 July 2024 it is taxed at a flat 20%, plus 4% cess, whatever your income. There is no tax-free allowance. Short-term losses can be set off against short-term or long-term gains.

The gain is the sale value minus the cost, and brokerage, exchange charges, stamp duty and GST can be included in those figures. STT cannot. Unused short-term losses can be carried forward for eight years if you file your return on time.

Example. A short-term gain of ₹1 lakh pays ₹20,000 of tax plus ₹800 of cess.