LTCG (Long-Term Capital Gains) on unlisted shares applies when you sell shares you held for more than 24 months. The holding clock starts from the date shares are credited to your demat account.
Tax rate (post Budget 2024)
From 23 July 2024, LTCG on unlisted shares is taxed at 12.5% flat, without indexation. The earlier regime (20% + indexation) applied to sales before this date.
Tax = 12.5% × (Sale Price − Cost of Acquisition)
Surcharge and 4% health-and-education cess apply on top, making the effective rate ~14.5–15% for high earners.
What counts as cost
Your actual acquisition price — including platform fees. For ESOP shares, the cost is the exercise price plus any perquisite tax already paid at exercise.
Contrast with [STCG](/glossary/stcg)
If you sell before the 24-month mark, gains are Short-Term Capital Gains, taxed at your income-tax slab rate — potentially 30%+ for top earners.
Example: Bought unlisted shares at ₹100 in Jan 2022, sold at ₹300 in Mar 2024 (25 months). LTCG = ₹200/share × 12.5% = ₹25 tax per share — vs ₹60 had you sold one month earlier. Related: capital gains tax on unlisted shares.