Share buyback tax calculator

Work out the capital gain and tax on shares sold back to a company in a buyback from 1 April 2026, and compare it with the dividend-style rule that applied from 1 October 2024 to 31 March 2026.

Shares the company actually bought, not the number you offered

From the offer letter

What you paid for the shares

As reported for listed shares; check the rule

As reported for listed shares; check the rule

Used only for the earlier dividend-style rule

Amount received from the company
₹1,50,000
Cost of the shares
₹90,000
Capital gain
₹60,000
Holding counted as
Long-term
Rate applied
12.50%
Tax on the buyback from 1 April 2026
₹7,500
Amount left after that tax
₹1,42,500
Tax under the earlier rule (1 Oct 2024 to 31 Mar 2026): whole payout as dividend
₹45,000
Capital loss recorded under the earlier rule
₹90,000

Both lines are arithmetic on the rates you enter. Surcharge, cess, securities transaction tax, brokerage and any exemption are not included, and promoters are taxed differently.

How it works

From 1 April 2026: gain = shares × (buyback price − cost per share); tax = gain × rate (long-term if held more than 12 months), nil if there is a loss. Earlier rule: tax = amount received × slab rate; the cost is booked as a capital loss.

Assumptions

  • From 1 April 2026 buyback proceeds are taxed as capital gains, with the cost of the shares deducted, as reported under the Finance Act 2026. The Act itself has not been checked here; read it.
  • The 20% and 12.5% defaults are the rates reported for listed shares. Sources differ on how they apply, so change them to the rate that applies to you.
  • From 1 October 2024 to 31 March 2026 the whole payout was taxed as a dividend at the holder’s slab rate and the cost became a capital loss that could only be set against capital gains. The loss is shown but its later use is not modelled.
  • Listed shares only. Long-term means held more than 12 months. Promoters pay an additional tax and are not covered. Surcharge, 4% cess, securities transaction tax and the annual capital-gains exemption are not included.

Read more

More tools

These tools do arithmetic on the numbers you enter. They are for illustration and education. They do not predict returns, and they are not investment, tax or financial advice. Returns are not guaranteed.