Securities transaction tax
This query is : Resolved
19 January 2012
Kindly help me...
I want to know what is the treatment of STT in computation of Total Income of an individual? Whether is is shown in GTI and then deduction is made of it or it is already deducted from head Income from capital gain and hence not included in GTI???
I want to know what is the treatment of STT in computation of Total Income of an individual? Whether is is shown in GTI and then deduction is made of it or it is already deducted from head Income from capital gain and hence not included in GTI???
19 January 2012
Treatment of STT depends upon the nature of the income.
If sale/purchase of shares, etc on which STT is paid are shown as Capital Gain, then STT is not allowed as deduction.
That means at the time of purchase, STT shall NOT be added to the cost of the asset, and
at the time of sale STT shall NOT be reduced from the sale price.
This position is as per Fifth Proviso to Section 48.
If the income is shown as business income, then STT paid is allowed as deduction u/s 36(xv).
If sale/purchase of shares, etc on which STT is paid are shown as Capital Gain, then STT is not allowed as deduction.
That means at the time of purchase, STT shall NOT be added to the cost of the asset, and
at the time of sale STT shall NOT be reduced from the sale price.
This position is as per Fifth Proviso to Section 48.
If the income is shown as business income, then STT paid is allowed as deduction u/s 36(xv).
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19 January 2012
Further i want to know if the deduction of STT is to be received under that particular head or lastly at the end from GTI
19 January 2012
Deduction is available only if the income is shown as BUSINESS INCOME.
Deduction shall be allowed while computing business income and NOT from GTI.
Earlier STT paid was allowed as rebate u/s 88E from GTI.
But now it is allowed as a deduction from business income.
Deduction shall be allowed while computing business income and NOT from GTI.
Earlier STT paid was allowed as rebate u/s 88E from GTI.
But now it is allowed as a deduction from business income.
19 January 2012
Thanks for giving answers of my queries...
Thanks a lot...
Thanks a lot...
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Guest
Guest
(Expert)
19 January 2012
Siddhartha ji you have explained exceptionally brilliantly.
Thanks so much.
Thanks so much.
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