CA K Sanjay BhargavChartered Accountant
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Capital gains under the Income-tax Act 2025: the renumbered sections

CA K Sanjay Bhargav, Chartered Accountant, Bengaluru

Membership No. 250054 · DISA (ICAI)

Published

Short answer: the charge moves from s.45 to s.67, computation from s.48 to s.72, and the reinvestment exemptions from the 54-series to ss.82–89. Rates and holding periods are unchanged — 20% short-term and 12.5% long-term on listed equity. The one real substantive change is buyback, back to capital-gains treatment from 1 April 2026.

Looking up one section? The two tables below map the whole capital-gains block. For sections outside capital gains, the full old-to-new mapping is the quicker reference; if you are mid-transaction rather than mid-lookup, see capital gains and portfolio taxation or, for property under a development agreement, JDA taxation.

Charge and computation

Provision1961 Act2025 Act
Charge of capital gainss.45s.67
Liquidation distributions.46s.68
Buyback of sharess.46As.69
Transactions not regarded as transfers.47 / s.47As.70 / s.71
Mode of computations.48s.72
Cost with reference to previous owners.49s.73
Depreciable assetss.50 / s.50As.74 / s.75
Market-linked debenturess.50AAs.76
Slump sales.50Bs.77
Stamp-duty value on land/buildings.50Cs.78
Unquoted shares FMVs.50CAs.79
Advance money forfeiteds.51s.81
Cost / improvement definitionss.55 / s.55As.90 / s.91

The exemptions — the 54-series becomes 82–89

This is the block most people actually need, and the renumbering is clean and sequential.

Exemption1961 Act2025 Act
Residential house → residential houses.54s.82
Agricultural lands.54Bs.83
Compulsory acquisition of industrial land/buildings.54Ds.84
Bonds (₹50 lakh cap)s.54ECs.85
Any long-term asset → residential houses.54Fs.86
Shift from urban area / to SEZs.54G / s.54GAs.87 / s.88
Extension of times.54Hs.89

The conditions have not moved with the numbers: the reinvestment periods, the one-house restriction under Section 86 (ex-54F), the ₹50 lakh ceiling and the six-month window under Section 85 (ex-54EC) all continue as before. What changes is the citation on your working.

Rates for tax year 2026-27

Provisionex-1961AssetRate
s.196s.111ASTT-paid listed equity, equity MF, business-trust units — short term20%
s.198s.112AThe same assets — long term12.5% above ₹1,25,000 a year
s.197s.112Other long-term gains12.5% without indexation

Holding periods: 12 months for listed securities and equity mutual funds; 24 months for immovable property and everything else.

The indexation position. The general rule since the Finance (No. 2) Act 2024 is 12.5% without indexation. The significant survivor is the option for a resident individual or HUF to compute at 20% with indexation on land or building acquired before 23 July 2024. Because it is an option, both computations should be run and the lower tax adopted — it does not default to the better one.

The cost inflation index for tax year 2026-27 is 384, notified under Section 72(8)(a) of the 2025 Act. The figure for FY 2025-26 was 376.

⚠️ Buyback: a real change, not a renumbering

From 1 April 2026, the Finance Act 2026 moves share buyback back to capital-gains treatment under Section 69, away from the deemed-dividend approach that applied after the buyback-tax sunset. It also imposes an additional tax on promoter shareholders, and confines the treatment to buybacks carried out under Section 68 of the Companies Act, 2013.

If a buyback is in prospect, the tax outcome depends on which side of 1 April 2026 it falls and whether the shareholder is a promoter. That is worth establishing before the transaction, not after.

Separately, the Sovereign Gold Bond maturity exemption has been confined to original subscribers who hold to maturity — so a bond bought on the secondary market no longer carries the same outcome.

What has not changed

Almost everything else. The 2025 Act is a re-codification: same charge, same computation mechanics, same exemptions, same rates, same holding periods. If your working was right under the 1961 Act, it is right under the 2025 Act with the citations updated.

And the year still decides the Act. Gains realised in FY 2025-26 (AY 2026-27) are computed and returned under the 1961 Act with its old numbering, whenever you file. The 2025 Act numbering applies to gains from 1 April 2026 onwards. See does the Income Tax Act 2025 change your FY 2025-26 return?.

For the sections outside capital gains, the full old-to-new mapping is the quick reference. If the asset sold was foreign — RSUs, ESOPs or an overseas holding — the disclosure side is separate and matters independently of the tax: see Schedule FA from your broker statement.

This is a working reference, not the statute. For anything you are filing or relying on, confirm the section text against the Act or the department's official 1961-vs-2025 comparison utility.

Frequently asked questions

Which section charges capital gains under the new Act?

Section 67 of the Income-tax Act, 2025 — the old Section 45. The mode of computation, previously Section 48, is now Section 72. The structure of the charge is unchanged: a transfer of a capital asset, a computation of full value of consideration less cost of acquisition and improvement and expenses on transfer, and then a rate depending on the asset and the holding period.

What is Section 54 now?

Section 82. The reinvestment exemption for a residential house sold and replaced with another residential house is at Section 82 of the 2025 Act. The related exemptions have moved with it: Section 54B becomes 83, Section 54D becomes 84, Section 54EC becomes 85, Section 54F becomes 86, Sections 54G and 54GA become 87 and 88, and Section 54H — extension of time where consideration is not received — becomes Section 89.

Have the capital gains tax rates changed?

No. Short-term gains on STT-paid listed equity are 20% under Section 196 (the old 111A). Long-term gains on the same assets are 12.5% above the ₹1,25,000 annual exemption under Section 198 (the old 112A). Other long-term gains are 12.5% without indexation under Section 197 (the old 112). The Finance Act 2026 left rates untouched.

Does indexation still exist?

Only in narrow pockets. Since the Finance (No. 2) Act 2024, the general position is 12.5% without indexation. The main survivor is the option for a resident individual or HUF to compute at 20% with indexation on land or building acquired before 23 July 2024 — an option, so it should be computed both ways and the better one taken. The cost inflation index for tax year 2026-27 is 384, notified under Section 72(8)(a) of the 2025 Act.

What are the holding periods?

Twelve months for listed securities and equity mutual funds; twenty-four months for immovable property and all other capital assets. These were rationalised by the Finance (No. 2) Act 2024 and carry into the 2025 Act unchanged.

Has anything actually changed in substance, or is it only renumbering?

Mostly renumbering — but buyback is a real change. With effect from 1 April 2026 the Finance Act 2026 returns share buyback to capital-gains treatment at Section 69, moving away from the deemed-dividend approach, and adds an additional tax on promoter shareholders. Sovereign Gold Bond maturity exemption has also been confined to original subscribers who hold to maturity. Both are substantive and both need checking against the Act text before you rely on them.

Sold property or shares this year?

Send the purchase and sale documents with dates. The gain, the holding period, the exemption you can claim and the reinvestment deadline are worked out and set down in writing before the return is prepared.

Related service: Capital Gains & Portfolio Tax