Capital gain

Page no : 2

SAURABH NENE (Chartered Accountant) (226 Points)
Replied 19 February 2014

Yes. It seems you and Arpit are under the wrong impression that, all short term capital gains are chargable at some special rate of tax. Its not So. If the short term capital gain is not specifically referred in the income tax act to be chargable at special rate, then it is just like your any other normal income. Short term capital gain on shares and securities has been specifically referred u/s 111A to be chargable at concessional rate of tax @ 15% (subject to certain conditions) and there may be few other such STCG I am not sure. But otherwise STCG arising from other assets is chargable as normal income.

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Arpit Pachisia (CA) (734 Points)
Replied 19 February 2014

Sir, As you are saying that STCG arising from other assets is chargable as normal income, than it will be good for us na to have taxability as for normal income. As first rate of slab is 10%, so better give 10% tax as of comparing with flat 20% tax in LTCG

SAURABH NENE (Chartered Accountant) (226 Points)
Replied 19 February 2014

Dear Arpit, I am not advising to pay tax on LTCG. Here you are asuming that, the person falls under 10% slab rate i.e income between Rs. 2,00,000/- to 5,00,000/-. But if person is in 30% tax bracket i.e icome above Rs. 10 lacs then he will have to pay more tax. In conclusion the answer to Rahul's original question is, there is no way to avoide the tax by selling the property within one year.

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Rahul jain (LEARNING & TEACHING) (435 Points)
Replied 19 February 2014

dear arpit saraubh sir wants to tell u that the rate 10% is not on property it is on shares and security...so there is no such rate for stcg on property...

the rate OF TAX on shares and security-

in case of STCG-tax rate will be as PER INCOME TAX SLAB(IF STT NOT PAID)

in case of STCG-15%(IF STT PAID)+CESS

in case of LTCG-20%(IF STT NOT PAID) + CESS

in case of LTCG -U CAN CLAIM LTCG AS TAX EXEMPTION (IF STT PAID)

AM I RIT OR WRONG????

PLZ CORRECT ME,,,,,,,,IF I AM WRONG.....

Arpit Pachisia (CA) (734 Points)
Replied 19 February 2014

Thank you sir,

In conclusion part we can say that if assessee comes in the bracket even upto 20% you can go for STCG and if assessee is in 30% tax bracket than its better to have a LTCG.

Rahul, yes there is no rate fix for STCG rather it includes in your whole income. Thats why there are three rates of 10%,20% and 30% for the assessee depanding upon his other net sources of income.

Thank you

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