Holding Period

The Holding Period is the duration for which an investor owns a financial asset before selling it. In India, the holding period determines the applicable capital gains tax rate. For equity shares, a holding period of more than 12 months qualifies for Long-Term Capital Gains (LTCG) tax at 10% (above ₹1 lakh), while a holding period of 12 months or less is subject to Short-Term Capital Gains (STCG) tax at 15%. For debt mutual funds, the threshold for long-term classification is 36 months. Tax-efficient investing requires careful attention to holding periods.