Profits on the sale of securities.

Capital gain refers to the profit that you make from selling an asset such as investment, mutual funds or property. It is calculated as the difference between the amount invested and the sale value of the asset.

There are two types of capital gains: short- term and long-term.
Short-term capital gains (STCG) are for assets which you have held for a period lesser than:

1. One year for equity investments like equity mutual funds, stocks, etc.̥
2. Two years for real-estate investments
3. Three years for debt mutual funds
4. Long-term capital gains (LTCG) are for assets which you have held for a period more than:̥

- One year for equity investments like equity mutual funds, stocks, etc.
- Two years for real-estate investments
- Three years for debt mutual funds
- For capital gains, STCG or LTCG, taxation applies to the products for their duration of the investment.

For example, if an equity or stock investment is redeemed within one year of its purchase, then the difference between the sale price and the purchase price for the specific number of units would be considered as STCG and would be taxed accordingly.