STCG — Short-Term Capital Gains

STCG is the gain you make when you sell a capital asset you have held for a short period — at or below the long-term threshold for that asset. It is generally taxed at higher rates than long-term gains.

What it is

A short-term capital gain arises when you sell a capital asset that you held for a short period — at or below the long-term holding threshold for that asset type. What counts as short-term depends on the asset: for listed equity shares and equity mutual funds the cut-off is shorter than for property or unlisted assets. Because the asset was held briefly, the gain is treated as short-term and is taxed less favourably than a long-term gain on the same asset.

Why it matters

Short-term gains are generally taxed at higher rates than long-term gains. For listed equity shares and equity mutual funds a special short-term rate applies, while many other short-term gains are simply added to your income and taxed at your slab rates — so they raise your taxable income directly. Rates and rules vary by asset, so confirm the current figures on the official portal. Short-term gains form part of your gross total income and affect which return form you use.

Example Illustrative

Suppose you bought listed equity shares and sold them within a few months, making a gain of ₹50,000. Because the holding period is at or below the threshold, this is a short-term capital gain and a special short-term rate applies to listed equity. A short-term gain on a different asset might instead be added to your income and taxed at your slab. Check the official portal for the current rate. Figures are illustrative only.