ITR-2 FY 2025-26: Capital Gains, RSUs & the July 31 Deadline
If you sold even one mutual fund unit or had RSUs vest in FY 2025-26, your tax return just got more complicated — and the deadline you think you have is probably wrong. Salaried professionals with capital gains file ITR-2, not ITR-1, and the date is 31 July 2026, not the 31 August date doing the rounds. Here is the filing map for ₹15 lakh-plus earners with equity, RSUs, or foreign stock.
Summary
| Question | Answer for salaried + capital gains |
|---|---|
| Which form? | ITR-2 (the moment you have any gain) |
| Your deadline | 31 July 2026 — not 31 August |
| Equity LTCG rate | 12.5% above ₹1.25 lakh/year, no indexation |
| Equity STCG rate | 20% (sold within 12 months) |
| RSU/ESOP foreign shares | Schedule FA — mandatory even if unsold |
| Miss the date? | ₹5,000 fee + lost loss carry-forward |
The August 31 trap
Budget 2026 introduced staggered ITR deadlines, and the internet flattened it into "the deadline is now August 31." It is not — not for you.
- 31 July 2026: salaried, pensioners, and investors with capital gains, one house property, or interest income — anyone filing ITR-1 or ITR-2 without a tax audit.
- 31 August 2026: freelancers, professionals, and small business owners filing ITR-3 or ITR-4.
- 31 October 2026: anyone whose accounts need a statutory audit.
If your income is salary plus capital gains plus dividends, you are in the first bucket: 31 July. The extra month is for business filers, not for you.
You are now on ITR-2, not ITR-1
ITR-1 (Sahaj) has no capital gains schedule. The moment you sold equity, redeemed a mutual fund, or had RSUs vest and later sold them in FY 2025-26, you must file ITR-2. There is no threshold — a single ₹500 gain forces the switch.
What ITR-2 adds
Schedule CG (capital gains), Schedule FA (foreign assets, if you hold RSUs/ESOPs of a foreign parent), Schedule 112A (equity LTCG, scrip by scrip), and Schedule OS (dividends). ITR-2 online filing for FY 2025-26 is already live on the income tax portal.
Action: pull your broker and AMC capital gains statements now — you will need scrip-level detail for Schedule 112A.
Capital gains: FY 2025-26 is the first clean year at the new rates
Budget 2024 changed equity capital gains rates with effect from 23 July 2024, which made FY 2024-25 a messy split year (old rates before 23 July, new after). FY 2025-26 is the first full year entirely on the new rates, and Budget 2026 kept them unchanged.
Long-term (held over 12 months) — Section 112A
12.5% on gains above ₹1.25 lakh per year. No indexation for listed equity. The ₹1.25 lakh exemption is per financial year, per PAN — use it every year rather than letting gains pile up.
Short-term (held 12 months or less) — Section 111A
20% flat, regardless of your slab. For a ₹30 lakh earner this is lower than the 30% slab — but you cannot defer it.
Loss set-off rules that save real money
- Short-term capital loss (STCL) offsets both STCG and LTCG.
- Long-term capital loss (LTCL) offsets only LTCG.
- Unadjusted losses carry forward 8 years — but only if you file by 31 July 2026.
Action: harvest STCL where it offsets 20% STCG — it is your most valuable loss to book.
RSUs and ESOPs: the ₹10 lakh trap
If you work at a GCC, MNC, or a startup with a US or foreign parent, your RSUs and ESOPs create two tax events and one disclosure obligation most people miss.
- At vesting (RSU) or exercise (ESOP): the perquisite value is taxed as salary and is already in your Form 16. Nothing extra to pay, but confirm it appears in Schedule S.
- At sale: capital gains. Foreign shares held over 24 months are long-term (taxed at 12.5% plus surcharge and cess, with no Section 112A ₹1.25 lakh benefit — that is only for Indian listed equity); 24 months or less is short-term, taxed at your slab.
- Schedule FA disclosure: you must report foreign holdings held at any time during the relevant calendar year (January to December 2025), even if you never sold and earned zero. Skipping this invites a ₹10 lakh penalty under the Black Money Act — flat, regardless of your income.
Action: if you claimed credit for US tax withheld (for example on dividends), file Form 67 before you file your ITR. Miss it and your foreign tax credit is denied, taxing the same income twice.
What happens if you miss 31 July
| Consequence | Detail |
|---|---|
| Late fee (Section 234F) | ₹5,000 (₹1,000 if total income up to ₹5 lakh) |
| Interest (Section 234A) | 1% per month on unpaid tax |
| Loss carry-forward | Forfeited — capital losses gone permanently |
| Belated return | Allowed until 31 December 2026, with the above |
The carry-forward loss is the silent killer. A ₹3 lakh capital loss you could offset against next year's gains is worth roughly ₹37,500 to ₹60,000 in future tax saved — gone if you file even one day late.
What to do this week
- Download capital gains statements from every broker and AMC, plus your RSU/ESOP vesting and sale reports.
- Confirm you are filing ITR-2 — if a portal or preparer auto-selected ITR-1, it is wrong the instant you have any capital gain.
- Reconcile every gain against your AIS and Form 26AS before filing — mismatches trigger automated notices.
- If you hold foreign RSUs/ESOPs, complete Schedule FA and file Form 67 first. Do not skip Schedule FA even on zero income.
The bottom line
For salaried professionals with equity, mutual funds, or RSUs, FY 2025-26 filing is an ITR-2 job due 31 July 2026 — and the August date is a trap that does not apply to you. Get your statements early, protect your loss carry-forward, and do not let Schedule FA quietly expose you to a ₹10 lakh penalty.
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