13.3How are equity delivery profits taxed?
Time-sensitive: Checked November 2026 for FY 2026-27. Verify on incometaxindia.gov.in, NSE, BSE or SEBI before filing or trading. Rules and rates change, so check the official source before acting.
1What is it?
Delivery trades (buy, hold, sell) are capital gains: STCG if held ≤ 12 months, LTCG if longer. Losses can be set off.
2Why does it exist?
This treatment is usually simpler and cheaper than business income.
3Diagram
| Loss type | Can be set off against | Carry forward |
|---|---|---|
| Short-term capital loss | STCG and LTCG | 8 years |
| Long-term capital loss | LTCG only | 8 years |
4Practical use
You must file your return on time to carry forward losses.
5Quick revision
- STCG/LTCG by holding period.
- STCL sets off against both; LTCL only against LTCG.
- Carry forward 8 years if filed on time.
6Knowledge check
Q1. Can LTCL offset STCG?Show answer
No.
Q2. For how many years can capital losses be carried forward?Show answer
8 years.
Q3. Condition for carry forward?Show answer
File the return by the due date.