Tax
Capital gain
The profit subject to capital gains tax.
The Formula
Gain = sale proceeds - cost basis
The profit subject to capital gains tax.
| Symbol | Meaning | Unit | Notes |
|---|---|---|---|
| P | Sale proceeds | currency | What you received. |
| B | Cost basis | currency | What you paid, including fees. |
What Each Symbol Means
Pcurrency
Sale proceeds
What you received.
Bcurrency
Cost basis
What you paid, including fees.
See It Worked With Real Numbers
A formula on its own does not tell you which number goes where. The how to calculate capital gains tax page applies this equation to a concrete case, shows every intermediate step, and names the mistakes that produce a wrong answer even when the algebra is right.
Where This Formula Appears
This equation is the working core of How To Calculate Capital Gains Tax, filed under Finance. Every number the guide produces comes from substituting into this one line.