Why Capital Gains ITR Needs Expert Help

Capital gains computation is the most error-prone part of individual ITR — wrong rates, missed exemptions, or incorrect indexation can cost you lakhs.

01

AIS Captures Every Transaction

The IT department's AIS captures every buy/sell transaction across all demat accounts. If it is in AIS and not in your ITR, a notice is guaranteed.

02

Correct LTCG and STCG Rates

Equity LTCG: 12.5% above ₹1.25L (Section 112A). Equity STCG: 20% (Section 111A). Debt/property: different rates apply. Using the wrong rate means wrong tax.

03

Section 54 Can Save Lakhs

Sold a house? Section 54 exempts capital gains reinvested in a new property. Section 54EC exempts up to ₹50L invested in specified bonds. These exemptions can eliminate your entire capital gains tax.

04

Carry Forward Capital Losses

Short-term capital losses can be set off against any capital gains. Long-term losses set off only against LTCG. Losses must be declared in ITR — on time — to carry forward and use in future years.

Legal Framework

Capital gains tax rates and exemptions are defined under the Income Tax Act 1961 — with specific rules for each asset class.

Section 112A — LTCG on Listed Equity and Equity MF: Long-term capital gains on equity shares and equity-oriented mutual funds held for more than 12 months are taxable at 12.5% on gains above ₹1.25 lakh. Grandfathering applies to gains accrued before 31 January 2018.

Section 111A — STCG on Listed Equity: Short-term capital gains on equity held for 12 months or less are taxable at 20% (changed from 15% effective FY 2024-25 per Budget 2024).

Section 54 / 54EC / 54F — Property Exemptions: Capital gains from sale of residential property can be exempted by reinvesting in another residential property (Section 54) or in specified REC/NHAI bonds up to ₹50 lakh (Section 54EC) within the prescribed time limits.

Filing Process

We collect broker statements from all demat accounts, compute gains per asset class, and check every available exemption before filing.

1

Collect Broker P&L Statements

Capital gains / P&L reports from all brokers (Zerodha, Groww, HDFC Securities, etc.) and all demat accounts are gathered for the full financial year.

2

Compute LTCG and STCG Separately

Gains are split by asset class — equity, equity MF, debt MF, property — and by holding period (long-term vs short-term) with correct tax rates applied.

3

Apply Indexation for Debt and Property

For debt funds and property, the cost of acquisition is indexed using the Cost Inflation Index to reduce taxable gains. This significantly reduces the capital gains on long-held assets.

4

Check Section 54 Exemption Eligibility

For property sales, we check eligibility for Section 54/54EC/54F exemptions. If eligible, the exemption computation is done and requirements (reinvestment deadline, CGAS) are explained.

5

File ITR-2 with Schedule CG

ITR-2 is filed with all capital gains data correctly entered in Schedule CG, Schedule 112A (for equity LTCG), and Schedule VDA (for crypto). E-verified after filing.

Documents Required

Broker statements, sale deeds for property, and Form 26AS are the primary documents needed.

Broker P&L statement / capital gains report (all demat accounts)
Sale deed and purchase deed (for property sale)
Purchase cost details and improvement expenditure (for property)
Section 54 investment proof (new property registration/booking deed or 54EC bond certificate)
Form 26AS (TDS deducted on property sale by buyer)
Bank statements showing sale proceeds received
PAN card and Aadhaar card
Income tax portal login credentials

Timeline

4–5 days depending on number of transactions and asset types involved.

Day 1–2

Data Collection

Day 2–4

LTCG/STCG Computation

Day 4–5

ITR-2 Filed

31 Jul 2026

Deadline

Benefits & Risks

Benefits of Accurate Filing

All AIS transactions declared — zero risk of mismatch notices
Section 54 exemptions correctly applied — can save lakhs in tax
Indexation benefit applied to reduce debt and property LTCG
Capital losses carried forward for future years (must be filed on time)
TDS on property sale (1%) credited against tax liability

Risks of Incorrect Filing

AIS captures all transactions — undeclared gains trigger notices
Wrong indexation computation leads to excess tax payment
Missed Section 54 exemption means overpaying capital gains tax
Capital losses lapse if not declared in an on-time return
Crypto gains unreported attract 30% tax + penalty under VDA provisions

ITR Filing — Capital Gains