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Need help on capital gains tax query

josh (IT) (256 Points)

12 March 2015

Hi Folks, I have a following queries, please help to clarify 1) Whether the short term capital gains from selling equity MFs are needs to be added to the income and tax according to slabs or it is not added to the income and tax separately only on the short term gains? 2) I have long term capital loss from selling equity MFs in previous financial year 2013-14. Can this loss is allowed to be adjusted against the short term capital gains from selling equity MFs in current financial year 2014-15 ???? Thanks Josh

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6 Replies

budha bhargav (Student) (52 Points)
Replied 12 March 2015

1)short term capital gain has to be charged @ 15%. However if an individual is having income other than short term capital gain less than basic exception limit. Total income over and above basic exemption limit will be charged at a flat rate of 15%. For example if an individual is having income from business amounting to 1,00,000 and short term capital gain of 220000. Total amount exceeding basic exception limit of 200000 is 1,20,000/-, this amount will be charged @ 15% 2) long term capital gain cannot be sett off against short term capital gain. It should be carried forward to next financial year. Note : if u don't file your income tax return with in the due date you cannot carry forward the losses

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Vishal Goel (Chartered Accountant) (1688 Points)
Replied 13 March 2015

Short term capital gains arising on sale of share & mutual fund are taxed @ 15% under section 111A provided that such transaction is chargeable to SST.

In other cases : Short-term capital gains are added to the income and taxed as per the individual's income tax slab. (like : Gold, Debt, Real estate, Bond)

Vishal Goel (Chartered Accountant) (1688 Points)
Replied 13 March 2015

Long term capital gain on the sale of shares & mutual fund are exempted u/s 10(38),

long term capital loss on sale of share & mutual fund shall have no tax treatment & such loss can neither be set-off against any income nor be carried forward.

Manjunath K (Articleship) (28 Points)
Replied 13 March 2015

Long term capital gain on the sale of shares & mutual fund are exempted u/s 10(38) of IT act provided STT is paid and the transaction happen through a recognized stock exchange. Coming back ur question of set off of LTCL shall be allowed to set off only against LTCG provided return should have been filled within due date. If the IT return was not filled within the due date you have to forego the LTCL.

hiren (service ) (61 Points)
Replied 13 March 2015

Any deduction under 80c allowed in sec.111a ?

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Sahil Bhatia (Practicing Chartered Accountant) (290 Points)
Replied 14 March 2015

Not all gain from mutual funds are exempt but only equity oriented mutual funds are. So check carefully. Still long term loss isn't allowed to be set off from short term gains.