Educational guide
Capital Gains Tax on Shares — Listed vs Unlisted Treatment
Equity capital gains taxation forks based on whether shares are listed (STT-paid) or unlisted. The post-Budget-2024 rates apply differently to each.
// listed equity shares
Held ≤ 12 months → STCG @ 20% u/s 111A (STT-paid). Held > 12 months → LTCG @ 12.5% u/s 112A on aggregate gain above ₹1,25,000 per FY. Cess 4% applies.
// unlisted shares
Held ≤ 24 months → STCG at slab rate. Held > 24 months → LTCG @ 12.5% without indexation. Indexation benefit on unlisted shares was withdrawn in Budget 2024.
// esops
On exercise of ESOP, the difference between FMV and exercise price is taxed as perquisite (salary). On subsequent sale, the difference between sale price and FMV-on-exercise-date becomes capital gains — short-term or long-term based on the holding period from the exercise date.
// frequently asked questions
Bonus shares have a cost of acquisition of zero. Their holding period is counted from the bonus allotment date. On sale, the full sale proceeds become capital gains — short-term or long-term based on that holding period.