SIP Return Calculator

Q: How are Equity Mutual Fund SIP returns taxed in India as of August 2026?

Long-Term Capital Gains (units held over 1 year) exceeding Rs 1.25 lakh in a financial year are taxed at 12.5%. Short-Term Capital Gains (units held under 1 year) are taxed at a flat 20%. Each SIP installment has its own 1-year clock, so a long-running SIP can have a mix of long-term and short-term units at redemption. Always verify against the latest Finance Act before relying on this for filing.

Plan mutual fund wealth creation with monthly compounding, step-up increments, inflation, and post-tax adjustments.

📅 Updated: October 2026 • 📐 Standard: Monthly Compounding, Annuity-Due • 🔍 Verified by: KitnaPaisa Research Team

Monthly Investment

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₹10 Thousand

Expected Return (p.a)

Time Period

Annual Step-Up (Top-Up)

Annual Increment

Adjust for Inflation

Inflation Rate (p.a)

Show Post-Tax Maturity Value

Total Invested

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Est. Wealth Gain

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Maturity Value
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Wealth Growth Multiplier

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Times of Total Invested

Post-Tax Maturity Value

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Investment Ratio

Wealth Growth Trajectory

Your Expected Rate vs Common Benchmarks (Historical Averages)

Benchmark figures are long-run historical approximations, not guarantees.

Yearly Breakdown Schedule

Year	Monthly SIP	Total Invested	Yearly Gain	End Balance

Sensitivity: Maturity Value Across Rate & Duration

Years \ Rate

Highlighted cell matches your current inputs. Assumes no step-up, for a like-for-like comparison across scenarios.

📐 Mathematical Methodology & Verification

Flat SIP: FV = P × [ (1+i)ⁿ − 1 ] / i × (1+i)
Step-Up SIP: FV = Σ (for year k = 1 to Y) [ SIPₖ × ((1+i)¹² − 1) / i × (1+i) ] × (1+i)^(12×(Y−k))
where SIPₖ = P × (1 + step-up%)^(k−1), i = annual rate ÷ 12 ÷ 100, Y = total years
Post-Tax Maturity = Final Value − max(0, Gain − ₹1.25L) × 12.5%

Why two formulas: a flat SIP has one installment compounding uniformly, so the closed-form annuity formula applies directly. A step-up SIP has a different installment every year, so each year's contribution is compounded forward separately and then summed — this calculator runs that segmented calculation month-by-month rather than using the flat formula, which is why the two are shown separately here instead of one formula covering both.
Client-Side Execution: All calculations run locally in your browser. No financial data is transmitted.
Tax Simplification: the post-tax estimate assumes the entire redemption is Long-Term. In practice, a multi-year SIP has a mix of holding periods across installments — treat this as an upper-bound estimate, not a filing figure.

Researched & Maintained by the KitnaPaisa Financial Team

KitnaPaisa provides free, transparent financial tools for Indian retail investors, adhering to standard compounding formulas and regulatory norms.

Understanding Systematic Investment Plans (SIP)

A Systematic Investment Plan (SIP) allows an investor to allocate a fixed sum into mutual fund schemes periodically (typically monthly) rather than committing a large lump-sum. This instills investing discipline and takes advantage of Rupee Cost Averaging.

Why Step-Up SIP Needs a Different Formula

A flat SIP formula assumes the same installment every month for the entire tenure. A step-up SIP breaks that assumption every year, so it cannot be represented by a single closed-form formula — this calculator computes it as a sum of separately-compounded yearly tranches, shown in the methodology section above.

Frequently Asked Questions

What is a Step-Up SIP and how is it calculated? ▼

A Step-Up (or Top-Up) SIP increases your monthly installment by a fixed percentage every 12 months. Each year's installment is compounded forward separately at the monthly rate, then all years are summed together — it is not the same as a flat SIP formula, since every year contributes a different starting installment.

How are Equity Mutual Fund SIP returns taxed in India as of August 2026? ▼

Long-Term Capital Gains (units held over 1 year) exceeding ₹1.25 lakh in a financial year are taxed at 12.5%. Short-Term Capital Gains (units held under 1 year) are taxed at a flat 20%. Each SIP installment has its own 1-year clock, so a long-running SIP can have a mix of long-term and short-term units at redemption. Always verify against the latest Finance Act before relying on this for filing.

What happens if I miss a monthly SIP payment? ▼

Mutual fund AMCs do not charge a penalty for a missed SIP installment, though your bank may charge an auto-debit bounce fee if the linked account has insufficient balance. Missing one or two installments will not cancel the SIP.