How to report capital gains in your ITR

Report capital gains in the capital gains schedule of ITR-2 (or ITR-3), sale by sale, with the sale date and value, the purchase date and cost, and the type of gain. ITR-1 can carry only long-term gains on listed shares and equity funds up to ₹1,25,000. Match your figures to your AIS before filing.

The rules here are signed off for the tax year 2025-26 and provisional for the tax year 2026-27. See capital gains tax in India: complete guide for the rates.

Step 1: Pick the form

Step 2: Collect the sales

• AIS and TIS. Look under sale of securities and units of mutual funds, and sale of land or building. They list what brokers, fund registrars and property registrars reported.
• Broker capital gains statement for the tax year, 1 April to 31 March.
• Mutual fund statements from the registrar for each fund.
• Property documents for any sale.
• Crypto exchange statements for virtual digital assets.

TaxCare can pre-fill sales from the AIS, but the AIS often shows only the sale value, not your purchase cost. You supply the cost.

Step 3: Classify each sale

For every sale decide short-term or long-term from the dates.

• Listed shares and equity-oriented funds: long-term if held more than 12 months.
• Other assets: long-term if held more than 24 months, for transfers on or after 23-Jul-2024.

Also note whether the sale happened before or on or after 23-Jul-2024, since the rate and holding period changed then. For the tax year 2025-26 every sale falls on or after that date, so the new rates apply to all of them.

Step 4: Work out each gain

• Sale value less transfer expenses (broker, stamp duty on sale).
• Cost of acquisition, with indexation where available and the 31-Jan-2018 grandfathered value for shares bought before 1-Feb-2018.
• Cost of improvement for property.
• For property, check the stamp-duty value rule: if the stamp-duty value exceeds the sale price by more than 10%, it replaces the price.

Step 5: Claim an exemption, if you qualify

If you sold a house and bought another, or invested in specified bonds, you may claim an exemption under the sections for that purpose. The return asks for the details of the new asset and the dates. The caps on TaxCare's rules are ₹10 crore for the new house and ₹50 lakh for bonds in a year.

The conditions for each exemption are set by the Act, so check them before you claim.

Step 6: Set off and carry forward losses

Short-term losses set off against short-term and long-term gains; long-term losses against long-term gains only. Losses not absorbed are carried forward for 8 years if the return is filed on time. Report brought-forward losses from earlier years in the return too.

Step 7: Check against the AIS

• Does every sale in your AIS appear in your return?
• Is a sale reported twice in the AIS (for example by the broker and the registrar)? Mark it as a duplicate through feedback.
• Does the sale value in your return agree with the contract notes?

Step 8: Pay the tax

Capital gains tax at special rates may not be fully covered by TDS. If tax is still due, pay it as self-assessment tax before submitting. If the sale was large during the year, advance tax may also have been due, and interest can apply.

Common mistakes

• Using ITR-1 with a short-term gain.
• Reporting only the AIS sale value without cost.
• Using the wrong date and so the wrong rate.
• Ignoring a loss, which loses carry-forward.
• Forgetting small mutual fund redemptions.

How TaxCare helps

TaxCare brings the sale entries from your AIS and TIS, asks you for the purchase cost of each lot, applies the holding periods, rates, indexation and exemption caps from its rules, and sets off losses. It selects ITR-2 when your gains require it. For cases it does not cover, such as unusual assets, it hands the return to a Tax Expert. See pricing.

This guide gives general information and is not professional tax advice.