LTCG Tax on Stocks: Are You Filing It Right?
Long-term capital gains from selling shares are taxed at 12.5% above ₹1.25 lakh per year. Many investors don't know what to report, when, or how — and wrong filing can trigger scrutiny or Section 68 notices.
Missing LTCG disclosure can cost you more than 6 months of chai bills — even if your gain is zero.
Your long-term stock gains up to this limit are completely tax-free
Key Takeaways
Download your capital gains statement from your broker or CDSL/NSDL before filing ITR — brokers provide this free.
Report every LTCG transaction in Schedule CG of ITR-2 or ITR-3, including gains below ₹1.25 lakh that are exempt.
Keep proof of purchase date, cost, and STT payment for every share sale — these documents defend you if the tax department questions your claim.
Long-term capital gains from selling shares are taxed at 12.5% above ₹1.25 lakh per year. Many investors don't know what to report, when, or how — and wrong filing can trigger scrutiny or Section 68 notices.
Here's what happened: Gains from listed shares held over 12 months are called LTCG and taxed at 12.5% above ₹1.25 lakh annually.. Income tax tribunals have repeatedly struck down Section 68 additions where genuine LTCG was wrongly treated as unexplained income.. ITR-2 and ITR-3 require you to report ALL LTCG transactions — even tax-free ones — or risk scrutiny notices..
What you should do: Download your capital gains statement from your broker or CDSL/NSDL before filing ITR — brokers provide this free.. Report every LTCG transaction in Schedule CG of ITR-2 or ITR-3, including gains below ₹1.25 lakh that are exempt.. Keep proof of purchase date, cost, and STT payment for every share sale — these documents defend you if the tax department questions your claim..
Pro tip: If you sold shares at a loss, offset it against LTCG gains in the same year and carry forward remaining losses up to 8 years — this can wipe out your entire LTCG tax bill legally.
For readers weighing their credit and loan options, our personal loan guide and CIBIL score resources put this update in context.
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This article is reported by GoCredit's Editorial Team based on the source above. GoCredit synthesises, contextualises, and adds India-borrower-relevant analysis. We are not the original publisher.