Step-by-Step: How to Fill Schedule CG for Capital Gains on Unlisted Share Sales

Schedule CG (Capital Gains) in ITR-2 or ITR-3 is where you report all unlisted share sales.

Short-term capital gains (holding period ≤24 months) are reported in Section A5 under "Equity shares or units not listed on recognized stock exchange," while long-term capital gains (holding period >24 months) are reported in Section B9.

• The Income Tax e-filing portal auto-calculates your gains once you enter the sale consideration, cost of acquisition, and expenditure on transfer.
• Each transaction must be entered separately with complete details including company name, number of shares, acquisition date, sale date, and distinctive numbers from your share certificate.
• The most common filing errors include reporting unlisted shares in Section A1 (meant for listed shares), using exercise price instead of Fair Market Value as acquisition cost for ESOPs, forgetting to deduct transaction costs, and mixing up holding period calculation dates.

Key Filing Facts:

• Section A5/B9 are specifically for unlisted shares; A1/B1 are for listed equity shares traded on recognized stock exchanges.
• Cost of acquisition for ESOP shares is the Fair Market Value at exercise (from Form 16), not the exercise price you paid.
• Transaction costs including legal fees, platform charges, and brokerage are fully deductible from sale consideration.
• Portal validates distinctive numbers against share count; mismatches will trigger errors requiring correction.
• Each company's shares must be entered as a separate transaction even if sold on the same date.

Before You Begin: Check this Documents Checklist

Gather these documents before logging into the ITR portal to prevent unnecessary delays, portal timeouts and critical calculation errors:

For Every Share Sale Transaction

Essential Documents:

✅ Share Purchase Agreement (SPA) or sale confirmation

• Shows: Sale date, sale price, buyer details

✅ Original Share Certificate (physical) OR Demat Holding Statement

• Shows: Certificate number, folio number, distinctive numbers, acquisition date

✅ Bank Statement showing receipt of sale proceeds

• Proves: Actual consideration received

✅ Cost of Acquisition Proof:

• For ESOP sellers: Form 16 showing FMV at exercise date
• For founders/investors: Original purchase receipt, allotment letter, or previous SPA

✅ Transaction Cost Receipts:

• Legal fees invoice
• Platform transaction fees
• Brokerage charges (if any)
• CA fees for valuation certificate

Pre-Calculation Worksheet

Before entering data in the portal, calculate your gains on paper:

STCG Calculation (≤24 months holding):

Sale Consideration: ₹_______
Less: Cost of Acquisition: ₹_______
Less: Transaction Costs: ₹_______
= Short-Term Capital Gains: ₹_______
Tax @ Slab Rate (30%): ₹_______

LTCG Calculation (>24 months holding):

Sale Consideration: ₹_______
Less: Cost of Acquisition: ₹_______
Less: Transaction Costs: ₹_______
= Long-Term Capital Gains: ₹_______
Tax @ 12.5%: ₹_______

Pro Tip: Keep this worksheet handy to verify the portal's auto-calculation.

Determining Holding Period: STCG or LTCG?

How to Calculate Holding Period

Start Date: Date you acquired the shares

• For ESOP sellers: Exercise date (when you converted options to shares)
• For founders: Allotment date (from share certificate)
• For investors: Purchase date (from previous SPA)

End Date: Date of sale (completion date, not SPA signing date)

Classification:

• ≤24 months: Short-Term Capital Gains (STCG) → Report in Section A5
• >24 months: Long-Term Capital Gains (LTCG) → Report in Section B9

Common Holding Period Mistakes

Example 1 - ESOP Seller:

• Grant date: January 1, 2022 ❌ (ignore)
• Vesting date: January 1, 2023 ❌ (ignore)
• Exercise date: June 1, 2024 ✅ (start date)
• Sale date: May 15, 2026
• Holding period: June 1, 2024 to May 15, 2026 = 23 months 14 days = STCG

Example 2 - Founder:

• Allotment date: March 15, 2022 ✅ (start date)
• Sale date: April 1, 2024
• Holding period: March 15, 2022 to April 1, 2024 = 24 months 17 days = LTCG

Step 1: Login to Income Tax e-Filing Portal

Access the Portal

1. Visit www.incometax.gov.in/iec/foportal
2. Click "Login" (top right)
3. Enter your PAN as User ID
4. Enter your password
5. Complete captcha or OTP verification
6. Click "Login"

First-Time Users: If you haven't registered, click "Register" and complete the one-time registration with PAN, Aadhaar, mobile number, and email.

Navigate to e-File

Portal Path:

1. After login, you'll see the dashboard
2. Click "e-File" in the top menu
3. Select "Income Tax Return"
4. Choose "File Income Tax Return"

Select Assessment Year and ITR Form

Assessment Year Selection:

• For FY 2025-26 (April 1, 2025 to March 31, 2026), select AY 2026-27
• The portal defaults to the current assessment year

ITR Form Selection:

• ITR-2: For individuals with salary + capital gains (most employees)
• ITR-3: For individuals with business/professional income + capital gains

Click "Continue" after selecting the form.

Choose Filing Mode

Two Options:

1. Online (Recommended): Fill form directly on portal; data pre-filled from AIS/26AS
2. Offline: Download JSON, fill offline, upload (for complex returns only)

Select "Online" for Schedule CG filing → Click "Continue"

Step 2: Navigate to Schedule CG

Complete Preliminary Sections First

Before accessing Schedule CG, the portal requires you to complete:

1. Personal Information:

• Name, PAN, address (pre-filled from previous returns)
• Filing status: Individual, HUF, etc.
• Residential status: Resident, NRI, etc.

2. Gross Total Income:

• Salary income (from Form 16)
• House property income
• Other sources income

Navigation Tip: Use the left sidebar menu to track which sections are complete (green checkmark).

Access Schedule CG

Path Through Portal:

1. In the left sidebar, locate "Income Details" section
2. Click "Capital Gains"
3. You'll see "Schedule CG" button
4. Click "Schedule CG" to open the capital gains schedule

What You'll See:

• Part A: Short-Term Capital Gains (multiple sub-sections A1-A5)
• Part B: Long-Term Capital Gains (multiple sub-sections B1-B9)

For unlisted shares:

• STCG: Navigate to Section A5
• LTCG: Navigate to Section B9

Step 3: Fill Section A5 (Short-Term Capital Gains)

Section A5: For Unlisted Shares ≤24 Months Holding

Section Title: "Short-term capital gains on equity shares or units other than those covered under section A1, A2, A3, and A4"

Click "Add" to Create New Entry

You'll see an "Add" button in Section A5. Click it to open the transaction entry form.

Field-by-Field Instructions

Field 1: Type of Asset

Dropdown Options:

• Equity shares of a company not listed in a recognized stock exchange ✅ (Select this)
• Units of business trust
• Units of equity oriented fund
• Other unlisted securities

What to Select: "Equity shares of a company not listed in a recognized stock exchange"

Field 2: Full Name of the Asset

What to Enter: Complete legal name of the company

Format: [Company Name] Private Limited

Example: "Incentiv Technologies Private Limited"

Common Mistake: Entering abbreviated names ("Incentiv" instead of full legal name). Use the exact name from your share certificate.

Field 3: Number of Shares

What to Enter: Total quantity of shares sold in this transaction

Example: 10,000

Important: If you sold shares in the same company on different dates or at different prices, enter each as a separate transaction.

Field 4: Date of Acquisition

Format: DD/MM/YYYY

What to Enter:

• ESOP sellers: Exercise date from Form 16
• Founders: Allotment date from share certificate
• Investors: Purchase date from previous SPA

Example: 01/06/2024 (June 1, 2024)

Portal Validation: Portal automatically calculates holding period. If you enter a date >24 months ago, it will show a warning that this should be in Section B9 (LTCG).

Field 5: Date of Sale/Transfer

Format: DD/MM/YYYY

What to Enter: Transaction completion date (when shares were transferred and payment received)

Not the SPA signing date: Use the date the company's Register of Members was updated or demat transfer completed.

Example: 15/05/2026 (May 15, 2026)

Field 6: Sale Consideration

What to Enter: Gross amount received from buyer (before deducting any costs)

Format: Enter in rupees (e.g., 1800000 for ₹18 lakh)

Do NOT Enter: Net amount after deducting transaction costs (those go in a separate field)

Example: 1800000

Field 7: Full Value of Consideration (Section 50CA)

What This Means: In most cases, this is the same as Field 6 (sale consideration).

Exception: If the transaction involved deemed consideration under Section 50CA (where FMV exceeds actual consideration for certain transactions), enter the higher deemed value.

For standard secondary sales: Enter the same amount as Field 6.

Example: 1800000

Field 8: Expenditure Incurred Wholly and Exclusively in Connection with Transfer

What to Include:

• ✅ Legal fees paid to lawyer for SPA drafting
• ✅ Platform transaction fees (e.g., Incentiv platform charges)
• ✅ Brokerage charges (if using a broker)
• ✅ Valuation fees (CA fees for Rule 11UA certificate)
• ✅ Stamp duty on transfer documents (if borne by seller)
• ✅ Registration fees

What NOT to Include:

• ❌ Personal travel expenses to meet buyer
• ❌ General legal consultation fees unrelated to this transaction
• ❌ Costs already included in acquisition cost

Example: 50000 (₹50,000 for legal fees + platform charges)

Documentation: Keep invoices for all claimed expenses in case of scrutiny.

Field 9: Cost of Acquisition

What to Enter:

For ESOP Sellers: Fair Market Value (FMV) at exercise date

• Where to find: Form 16, under "Perquisite from ESOPs"
• Not exercise price: If you paid ₹1 lakh to exercise but FMV was ₹10 lakh, enter ₹10 lakh

For Founders/Investors: Original purchase price paid

• Where to find: Share certificate, allotment letter, or previous SPA
• If multiple purchases: Use weighted average cost or FIFO method

Example: 1000000 (₹10 lakh FMV at exercise for ESOP seller)

Critical Error to Avoid: ESOP sellers frequently enter the exercise price (amount they paid) instead of FMV. This understates acquisition cost and overstates gains, leading to overpayment of tax.

Field 10: Deductions Under Section 48

What This Covers: Cost of improvement (generally not applicable to shares)

For unlisted shares: Leave this field as 0 or blank

Shares don't undergo "improvement" like property, so this deduction doesn't apply.

Auto-Calculated Field: Short-Term Capital Gains

The portal automatically calculates this for you using the following formula:

Field 6 (Sale Consideration) - Field 8 (Transfer Costs) - Field 9 (Acquisition Cost) = STCG

Example Calculation:

• Sale consideration: ₹18,00,000
• Transfer costs: ₹50,000
• Acquisition cost: ₹10,00,000
• STCG: ₹18,00,000 - ₹50,000 - ₹10,00,000 = ₹7,50,000

Verify: Cross-check this auto-calculated amount with your pre-calculation worksheet.

Save the Transaction

After filling all fields:

1. Click "Save" (bottom of form)
2. The transaction appears in Section A5 summary table
3. You'll see: Company name, shares sold, STCG amount

Add More Transactions (If Applicable)

If you sold shares in multiple companies or multiple tranches:

1. Click "Add" again in Section A5
2. Enter the next transaction's details
3. Repeat for all STCG transactions

Portal Behavior: All Section A5 entries are summed automatically to show "Total STCG from Section A5" at the bottom.

Step 4: Fill Section B9 (Long-Term Capital Gains)

Section B9: For Unlisted Shares >24 Months Holding

Section Title: "Long-term capital gains on equity shares or units other than those covered under section B1 to B8"

Click "Add" to Create New Entry

Navigate to Part B in Schedule CG, scroll to Section B9, and click "Add".

Field-by-Field Instructions (Same as A5 with Key Differences)

Fields 1-8: Identical to Section A5 (company name, shares, dates, consideration, costs)

Field 9: Cost of Acquisition: Same rules as STCG, but no indexation benefit for shares acquired after April 1, 2023.

Key Difference - Tax Treatment:

• STCG (A5): Taxed at your slab rate (up to 30%)
• LTCG (B9): Taxed at flat 12.5%

Example LTCG Transaction:

Indexation for Pre-April 2023 Shares

If you acquired shares before April 1, 2023, you have a choice:

Option 1: 12.5% tax without indexation (enter actual acquisition cost) Option 2: 20% tax with indexation (enter indexed acquisition cost)

To use indexation:

1. Calculate: Indexed Cost = Acquisition Cost × (CII of sale year / CII of acquisition year)
2. Enter the indexed cost in "Cost of Acquisition" field
3. You'll pay 20% on the lower indexed gains

Most taxpayers choose: 12.5% without indexation (simpler, often results in lower tax)

Step 5: Review and Validate

Portal's Built-In Validation

The e-filing portal runs automatic checks:

Common Validation Errors:

Error 1: "Holding period calculation suggests this should be in Section B9"

• Cause: You entered a LTCG transaction in Section A5
• Fix: Delete from A5, re-enter in B9

Error 2: "Cost of acquisition cannot exceed sale consideration"

• Cause: Typo in numbers (e.g., entered ₹18 crore instead of ₹18 lakh)
• Fix: Correct the field with the error

Error 3: "Invalid date format"

• Cause: Entered date in wrong format (e.g., MM/DD/YYYY instead of DD/MM/YYYY)
• Fix: Re-enter in DD/MM/YYYY format

Error 4: "Distinctive numbers do not match share count"

• Cause: If you entered distinctive numbers, they must match the share quantity
• Fix: Verify from share certificate and correct

Cross-Verification Checklist

Before proceeding to the next section:

• ✅ Each company's shares entered separately
• ✅ STCG and LTCG correctly classified by holding period
• ✅ Auto-calculated gains match your worksheet
• ✅ All transaction costs included (don't leave money on the table)
• ✅ For ESOPs: Used FMV from Form 16, not exercise price
• ✅ Sale consideration matches bank statement receipt
• ✅ Acquisition cost matches original proof documents

View Summary

To see your total capital gains:

1. Scroll to bottom of Schedule CG

You'll see summary boxes:

• Total Short-Term Capital Gains (sum of all A-sections)
• Total Long-Term Capital Gains (sum of all B-sections)

1. These totals auto-populate in the main ITR form's "Income from Capital Gains" section

Common Capital Gains Filing Errors and How to Fix Them

Error 1: Reporting Unlisted Shares in Section A1/B1

Wrong: Section A1 is "Listed equity shares sold on stock exchange where STT paid" Right: Unlisted shares go to A5 (STCG) or B9 (LTCG)

Impact: Incorrect tax calculation (STT-based shares have different tax treatment)

How to Fix:

1. Go to Section A1/B1
2. Delete the incorrect entry
3. Re-enter in Section A5/B9

Error 2: Using Exercise Price Instead of FMV for ESOPs

Wrong: Entering the ₹1 lakh you paid to exercise Right: Entering the ₹10 lakh FMV from Form 16

Impact: Overstates gains by ₹9 lakh, leads to ₹2.7 lakh excess tax (at 30% slab)

How to Find FMV:

1. Open your Form 16 for the exercise year
2. Look for section: "Income from Salary - Perquisites"
3. Find line: "Value of ESOPs exercised"
4. The amount shown is your FMV (acquisition cost)

Error 3: Forgetting Transaction Costs

Commonly Forgotten Costs:

• Platform fees charged by Incentiv or other platforms
• Legal fees for SPA drafting
• CA fees for valuation certificate

Impact: Overstates gains, overpays tax

Fix: Review all transaction-related invoices and add up costs before filing.

Error 4: Incorrect Holding Period Calculation

Mistake Example:

• ESOP granted: Jan 1, 2022
• ESOP vested: Jan 1, 2023
• ESOP exercised: June 1, 2024
• Sold: May 1, 2026
• Wrong: Calculating from grant (48 months → LTCG)
• Right: Calculating from exercise (23 months → STCG)

Impact: Wrong section, wrong tax rate

Fix: Always use exercise date for ESOPs, not grant or vesting.

Error 5: Mixing Multiple Companies in One Entry

Wrong: Combining "Sold 5,000 shares of Company A and 3,000 shares of Company B" Right: Two separate entries (one for Company A, one for Company B)

Impact: Portal rejection or validation errors

Fix: Use the "Add" button to create separate entries for each company.

Error 6: Not Reporting Capital Losses

Mistake: "I lost money, so I don't need to report it" Correct: You MUST report losses to carry them forward and offset them against any future capital gains that you earn.

Impact: Loss of carry-forward benefit worth potentially lakhs in future tax savings

Fix: Even if your gain is negative, complete Schedule CG entry. The portal will classify it as a loss and offer carry-forward.

After Filling Schedule CG: Next Steps

Step 1: Complete Remaining ITR Sections

After Schedule CG is complete, proceed to:

• Tax Deductions (80C, 80D, etc.)
• Tax Payments (Advance tax, TDS, self-assessment tax)
• Tax Computation (auto-calculated by portal)
• Verification (bank account, declaration)

Step 2: Verify Tax Computation

Portal Tax Summary:

• Gross Total Income
• Deductions under Chapter VI-A
• Total Income
• Tax on Total Income
• Less: TDS/Advance Tax/Self-Assessment Tax
• Tax Payable/Refundable

Check:

• Does capital gains tax match your expectation (30% of STCG + 12.5% of LTCG)?
• Any errors or unusually high amounts?

Step 3: Submit the Return

1. Click "Preview" to see complete ITR in PDF format
2. Review all sections one final time
3. Click "Submit" (bottom right)
4. Portal will run final validation
5. If validation passes, return is submitted
6. You'll receive an Acknowledgment Number

Step 4: E-Verify Within 30 Days

Mandatory Step: Your ITR is not considered "filed" until you e-verify.

E-Verification Options:

1. Aadhaar OTP (Instant): Receive OTP on mobile linked to Aadhaar
2. Net Banking: Login to bank account, verify via bank portal
3. Demat Account: Verify via demat account login
4. Bank ATM: Generate EVC at ATM
5. DSC (Digital Signature Certificate): For businesses

Recommended: Aadhaar OTP (fastest)

Timeline: Must e-verify within 30 days of submission. Otherwise, return becomes invalid.

Portal Navigation Tips and Shortcuts

Saving Your Work

Auto-Save: Portal auto-saves every few minutes, but don't rely on it.

Manual Save:

• Click "Save Draft" at the top of each section
• You can logout and return later

Resume Later:

• Login → e-File → File Income Tax Return
• You'll see "Continue with Saved Draft"
• All filled data is preserved

Editing After Saving

To Edit a Transaction:

1. Navigate to Schedule CG
2. Go to Section A5 or B9
3. Find the transaction in the summary table
4. Click "Edit" icon (pencil)
5. Modify fields
6. Click "Update"

To Delete a Transaction:

1. Navigate to the transaction in summary table
2. Click "Delete" icon (trash bin)
3. Confirm deletion

Copying Previous Year's Data

If you sold unlisted shares last year:

• Portal offers "Pre-fill" option
• Click "Import from Last Year"
• Review carefully (don't blindly accept)
• Dates, amounts, holding periods will be different

Not Recommended: Easier to enter fresh data than to edit old data.

Frequently Asked Questions

Q: Can I fill Schedule CG on mobile?

The Income Tax portal is mobile-responsive but complex forms like Schedule CG are difficult on small screens. Desktop/laptop filing is strongly recommended for accuracy and ease of navigation.

Q: What if I don't have the distinctive numbers from my share certificate?

Distinctive numbers are optional fields in the portal. If you don't have them (e.g., demat shares), leave that field blank. The portal accepts entries without distinctive numbers as long as other fields are complete.

Q: Can I enter multiple sales of the same company's shares on different dates as one combined entry?

No. Each sale transaction should be entered separately if they occurred on different dates or at different prices. This ensures accurate holding period calculation and gain tracking. Use the "Add" button to create multiple entries.

Q: What if my acquisition cost is higher than my sale price (I sold at a loss)?

Enter the data exactly as is. The portal will auto-calculate a negative gain (i.e., a loss). This loss will appear in Schedule CFL (Carry Forward of Losses) and can be carried forward for 8 years. Always report losses—they're valuable for future tax savings.

Q: Do I need to attach my SPA or share certificate when filing online?

No. Online ITR filing is document-free. You only enter data in the portal. However, you must retain all supporting documents (SPA, share certificate, Form 16, bank statements) for 7 years in case the Income Tax Department asks for them during scrutiny.

Q: Can I revise Schedule CG after submitting my ITR?

Yes. You can file a revised return under Section 139(5) to correct any errors in Schedule CG. The revised return can be filed until the end of the relevant assessment year or before completion of assessment, whichever is earlier. For AY 2026-27, you can revise until March 31, 2027.

Q: What if the portal's auto-calculated gain doesn't match my worksheet?

Double-check that you entered all fields correctly (sale price, acquisition cost, transaction costs). Common errors: Missing transaction costs, wrong acquisition cost, typos in amounts. If fields are correct but calculation still differs, take a screenshot and contact the IT helpdesk (1800-180-1961).

Schedule CG Filing Checklist

Before Filing:

• ✅ Documents gathered (SPA, share certificate, Form 16, bank statement)
• ✅ Holding period calculated for each transaction
• ✅ Gains pre-calculated on worksheet
• ✅ Transaction costs totaled with invoices

During Filing:

• ✅ Selected correct ITR form (ITR-2 or ITR-3)
• ✅ Navigated to Schedule CG in portal
• ✅ Used Section A5 for STCG (≤24 months)
• ✅ Used Section B9 for LTCG (>24 months)
• ✅ Entered each transaction separately
• ✅ Used FMV (not exercise price) for ESOP cost of acquisition
• ✅ Included all transaction costs
• ✅ Verified auto-calculated gains match worksheet
• ✅ Saved each entry before proceeding

After Filing:

• ✅ Reviewed tax computation summary
• ✅ Submitted ITR and received acknowledgment number
• ✅ E-verified within 30 days
• ✅ Saved filed ITR PDF for records
• ✅ Retained all supporting documents for 7 years

Disclaimer: This guide is for informational purposes only and does not constitute tax advice. ITR portal interface may change periodically. Always consult a qualified Chartered Accountant for personalized guidance.

Last Updated: February 2026 | Based on Income Tax Act, 1961 and ITR-2/ITR-3 forms for AY 2026-27