STCG Tax Calculator

Short-Term Capital Gains on Equity — 20% Post-Budget 2024

If you sell listed equity shares or equity-oriented mutual funds within 12 months of purchase, your gain is classified as Short-Term Capital Gain (STCG) and taxed at 20%. This rate applies regardless of your income slab — STCG on equity is not added to your total income and taxed at the marginal rate. It's a flat 20% plus 4% cess.

Budget 2024 raised this rate from 15% to 20%. That's a 33% increase in tax burden on short-term equity trading. For active traders who weren't using F&O, this is the change that stings most.

Old vs New STCG Rates: Budget 2024 Impact

When Does STCG Apply?

STCG on equity kicks in whenever you sell listed shares or equity MF units before completing 12 months of holding. Count from the day after purchase to the date of sale. If you bought on 15 March 2024 and sold on 14 March 2025, that's only 364 days — STCG applies. Sell on 15 March 2025 or later and it becomes LTCG.

The 12-month rule applies strictly. Many investors make the mistake of counting 'a year' loosely. Use the actual date arithmetic — your broker's capital gains report will tell you, but double-check before filing your ITR.

STCG applies per transaction, not per stock. If you bought HDFC Bank in three tranches, each tranche has its own acquisition date and holding period. The ones you hold longest qualify for LTCG first.

F&O Taxation — Not Capital Gains at All

Futures and Options (F&O) trading is treated as business income under Indian tax law, not as capital gains. This is true regardless of whether you hold a position for 1 day or 60 days. F&O profits are added to your total income and taxed at your marginal slab rate — up to 30% for individuals with income above ₹10 lakh.

The flip side: F&O losses are also business losses. They can be set off against other business income in the same year, and unabsorbed losses can be carried forward for 8 years against future business income. However, F&O losses cannot be set off against salary income. You also become liable for GST registration if your F&O turnover crosses ₹20 lakh in a year.

F&O traders must maintain proper books of accounts and can claim expenses — brokerage, internet charges, advisory fees, depreciation on equipment used for trading — as business deductions. This is one area where the 'business income' classification actually helps.

STCG Calculation Example

STCG Loss Set-Off Rules

Short-term capital losses from equity can be set off against both STCG and LTCG from any asset class. This is more flexible than LTCG losses, which can only offset LTCG. If you sold some stocks at a loss within 12 months and others at a gain, you net them before computing tax.

Example: ₹80,000 STCG from Stock A and ₹50,000 STCG loss from Stock B. Net taxable STCG = ₹30,000. Tax = ₹6,000 (@ 20%). The loss from B saved you ₹10,000 in tax. If you couldn't utilise the full loss in the current year, the balance carries forward for up to 8 assessment years.