Lt gain of debt funds vs lt loss of equity fund

Tax queries 779 views 3 replies

ITR-2 does not seem to distinguish between

LT gains/losses from debt mutual funds
vs
LT gains/losses from equity mutual funds/equity

in Schedule CG - capital gains.

These are taxed at 10% and 0% respectively.

I have LT gains/losses in both debt and equity mutual funds.Should I combine them while reporting these in Section-B of Schedule-CG? It seems wrong to combine them as they are taxed at different rates

Replies (3)

LTCG on Equity Oriented Mutual Funds(Exempt) are to be shown under Schedule EI(Exempt Income) in the return in Row 3.

As far as i remember, LTCG on debt funds is taxed at 10% only when indexation is not taken. It is treated as at par with CG on property transactions & tax rate of 20% is attracted with indexation benefit.

Analyse the transaction, if indexation saves your tax.

Regards

Originally posted by : Ankit Agarwalla

LTCG on Equity Oriented Mutual Funds(Exempt) are to be shown under Schedule EI(Exempt Income) in the return in Row 3.

As far as i remember, LTCG on debt funds is taxed at 10% only when indexation is not taken. It is treated as at par with CG on property transactions & tax rate of 20% is attracted with indexation benefit.

Analyse the transaction, if indexation saves your tax.

Regards

Thanks Ankit for your reply and the advice of using indexation.

I am not using indexation as it is computing higher tax.

So, if I undertand you correctly:

1. I should net the loss/gain of equity mutual funds *separate* from loss/gain of debt mutual funds.

2. LT gain in equity should be shown in schedule EI. Since negative numbers are not allowed in schedule EI, drop the losses.

3. LT loss/gain in debt funds should be shown in Schedule CG. Losses can be carried forward.

Could you please confirm my understanding.

Absolutely Correct.


CCI Pro

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