Offset your stock market gains and reduce your tax bill before March 31st. Automatically find which loss-making stocks to sell to minimize your STCG and LTCG liability.
Enter gains you have already booked this financial year.
Current Tax Bill
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Taxed at 20% flat.
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First ₹1.25L exempt, then 12.5%.
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Add stocks from your portfolio manually or upload a CSV.
Formulas, statutory slab logic, and edge-case exceptions authored and reviewed by Ganamurthy N N (M.S. Software Engineering, BITS Pilani | CFP® Certification Candidate — 3/4 Modules Cleared) • View Editorial Methodology →
Tax harvesting strategically realizes unrealized capital losses to neutralize taxable realized gains, or resets the cost basis of long-term equity by booking up to ₹1.25 Lakhs in tax-free gains every financial year.
Tax-Gain Harvesting Opportunity = Max(0, ₹1,25,000 - Realized LTCG YTD)
Tax Saved via Gain Harvesting = Tax-Gain Opportunity × 12.5% × 1.04
Tax-Loss Offset = Min(Unrealized STCL, Realized STCG + Taxable LTCG)
Tax Saved via Loss Harvesting = (Realized STCG Offset × 20.8%) + (Realized LTCG Offset × 13.0%)Selling and immediately repurchasing units raises your acquisition price to current market value, lowering future taxable gains.
Unused Section 112A exemption does NOT carry over to the next financial year.
Executing sells before the final trading days of March ensures delivery settlement within the financial year.
Scenario: Investor holds ₹1,20,000 in unrealized LTCG on Nifty 50 units and ₹50,000 in realized STCG from stock trades during FY 2026-27.
Saved ₹10,400 immediate cash tax + ₹15,600 future deferred LTCG tax!
Two complementary strategies for Indian equity investors
| Strategy Dimension | Tax-Gain Harvesting (Section 112A) | Tax-Loss Harvesting (Section 70) |
|---|---|---|
| Primary Objective | Utilize annual ₹1.25 Lakh tax-free LTCG quota | Neutralize taxable gains by realizing unrealized losses |
| Target Asset State | Units with unrealized Long-Term Gains (>12 months) | Holdings currently in the red (unrealized losses) |
| Tax Bracket Impact | Saves 12.5% future tax on up to ₹1.25 Lakhs/year | Saves 20% on STCG or 12.5% on LTCG immediately |
| Reinvestment Timing | Reinvest immediately to reset acquisition cost basis | Rebuy on T+1 or switch to alternative index fund |
| Annual Deadline | Must settle on or before March 31 (No carryover) | Must settle on or before March 31 (ITR filed by July 31) |
* Both harvesting strategies require execution before the last trading day of the financial year.
Selling and buying back the same stock in the same demat account on the same trading day is classified as an intraday speculative trade. To harvest loss legally, buy back on T+1 settlement or switch to a comparable ETF.
If you harvest losses on a Nifty 50 ETF, immediately reinvest proceeds into a BSE Sensex or Nifty LargeMidcap 250 fund. You lock in the tax loss while remaining 100% invested without missing a market rebound.
Before harvesting mutual fund gains, ensure the fund has crossed its 1-year exit load period (typically 1%). Ensure brokerage + STT costs are significantly lower than the 12.5% tax saved.
Under Section 112A, the first ₹1,25,000 of Long-Term Capital Gains on equity shares and equity mutual funds is 100% tax-free every financial year. However, this exemption is "use-it-or-lose-it"—it does not accumulate or roll over to future years. Tax Gain Harvesting involves selling units with up to ₹1.25 Lakhs in accumulated LTCG before March 31 and immediately repurchasing them. This resets your cost basis to the current market price without paying a single rupee in tax, permanently protecting those gains from future taxes.
India does not have a formal US-style 30-day wash-sale restriction. However, Section 43(5) treats transactions settled without physical delivery (i.e. buying and selling on the exact same trading day) as speculative intraday transactions. To ensure valid loss harvesting, execute your sell order, await T+1 physical delivery settlement, and repurchase the security the following day (or buy an equivalent alternative index fund).
When you harvest gains from mutual funds held across regular monthly SIPs, units are redeemed on a strict FIFO basis. The earliest purchased units are redeemed first. Only units that have completed at least 365 days of holding will be eligible for the ₹1.25 Lakh LTCG exemption; units held for less than a year will be taxed as STCG at 20%.
No! Under Section 70 of the Income Tax Act, an asymmetry exists: • Short-Term Capital Losses (STCL) CAN offset both STCG and LTCG. • Long-Term Capital Losses (LTCL) can ONLY offset Long-Term Capital Gains. You cannot use an LTCL to reduce your 20% STCG tax liability.
Because Indian stock exchanges operate on a T+1 settlement cycle, your sell trades must be executed and settled on or before the final trading day of March (typically March 30 or March 31). Trades executed on non-trading bank holidays will settle in April (FY 2027-28), causing you to miss the current financial year's deadline.
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