How SIP returns are calculated
P is the monthly amount, i the monthly return and n the number of instalments. Each instalment compounds for the remaining period, so starting early matters more than the amount.
Mutual fund returns are not guaranteed; this calculator assumes a constant return. Gains on equity funds are taxed as capital gains – see our capital gains calculator.
Frequently Asked Questions
What return should I assume for a SIP?
Long-term equity funds have historically returned around 10–12% a year, but returns vary and are not guaranteed. Use a conservative figure.
What is a step-up SIP?
A SIP where you raise the monthly amount by a fixed percentage every year, usually in line with salary increases.
Are SIP gains taxable?
Yes. Each instalment is treated as a separate purchase for capital gains; equity fund gains above ₹1.25 lakh a year are taxed at 12.5% after one year.
This calculator gives an estimate based on the rules shown above. Rates and limits change through budgets and notifications – confirm with a professional before you file or pay.