Shaunak Deshpande (Business) (44 Points)
05 January 2012Hello friends,
Suppose Total Income of an Individual consists of Short Term Capital Gain form Sale of shares Rs. 6,00,000/- He has no other income. What will be the tax payable by him for AY 2011-12 ?
Will it be -
1. 15% of 6,00,000/-
or
2. 15% of 4,40,000/- (Being 6,00,000 - 1,60,000)
Vineet Goyal
(Assistant Manager - Finance & Accounts)
(702 Points)
Replied 05 January 2012
15% of 4,40,000
CA Neil Ganatra
(Partner - Gautam Joshi & Co.)
(871 Points)
Replied 05 January 2012
if STT is paid i.e. shares are sold through recognised stock exchange then short term capital gain will be governed by section 111A and will be charged at 15% on capital gain i.e. Rs. 600000 in your case without any benefit of basic exemption limit. If you have transferred it to somebody offline, i.e. not sold through recognised stock exchange then it will be considered as normal slab income. you will have to pay tax at normal slab rates after basic exemption limit and not at flat 15%.
Jinay
(Article)
(172 Points)
Replied 05 January 2012
Agree with Vinit Goyal,
It will be 15% of Rs. 4,40,000/-
Pavan Kumar
(Manager - Finance)
(126 Points)
Replied 05 January 2012
It will be 15% of Rs.4,40,000/-
Bhanu Prakash Rao
(Think Beyond Stay Ahead...!)
(1064 Points)
Replied 05 January 2012
hi
As per Sec 111A of Income Tax Act, 1961 its 15% of 4,40,000/- (Being 6,00,000 - 1,60,000)
CA Neil Ganatra
(Partner - Gautam Joshi & Co.)
(871 Points)
Replied 05 January 2012
Dear Friends,
I made a mistake in the above statement. As per first proviso to section 111A, if the income other than STCG of the assessee is less than basic exemption limit then that much deficit should be adjusted against STCG and on remaining tax will be charged at flat 15%.
Due to this proviso only, in this case as there is no other income, 15% will be charged on Rs. 4,40,000/-.
Sorry for the mistake in statement made by me earlier.
CA SANDESH MAHIPAL
(Practicing in GST and MSME )
(1985 Points)
Replied 05 January 2012
BASIC EXEMPTION LIMIT IS ALSO ALLOWED UNDER SECTION 111A
SO 15% OF 440000 WILL BE TAXABLE.
Ramanuj
(Accountant.)
(834 Points)
Replied 05 January 2012
It will be 15% of 4,40,000/- Because basic examption is allow u/s 111A
Sandeep Surana
(Practicing Chartered Accountant)
(156 Points)
Replied 05 January 2012
Dear Friends,as per proviso 111A in the case of HUF & Individual being a resident, where the Total Income as reduced by STCG u/s 111A is below the Maximum amount not chargeable to tax (i.e.MANCT or Exemption Limit) than in that case such STCG reduced by remain MANCT shall be taxed at the rate of 10%
(its a benefit of technical mistake in language of Act)
So in the above case tax implication for AY 2011-12 is as follows:
Total income less STCG u/s 111A 600000 – 600000 = 0
MANCT available for STCG u/s 111A 160000/-
(and if MANCT available for STCG than Rate is 10% otherwise 15%)
Therefor Taxable STCG u/s 111A 600000 – 160000 = 440000/-
Tax Rate is equal to 10%
Tax on Such STCG u/s 111A 440000*10% = 44000/-
Suggestion and Comments most Welcome
Paresh Thakkar
(student)
(26 Points)
Replied 05 January 2012
Agree with Vinit Goyal,
It will be 15% of Rs. 4,40,000/-
deepak
(C.A & C.S Final)
(63 Points)
Replied 05 January 2012
Short term capital gains attract a tax of 15 per cent under Section 111A.
So your 2 choice is correct "15% of 4,40,000/- (Being 6,00,000 - 1,60,000)"
deepak
(C.A & C.S Final)
(63 Points)
Replied 05 January 2012
Short term capital gains attract a tax of 15 per cent under Section 111A.
So your 2 choice is correct "15% of 4,40,000/- (Being 6,00,000 - 1,60,000)"
Max Payne
(employed)
(2574 Points)
Replied 06 January 2012
| Originally posted by : Sandeep | ||
 |
Dear Friends,as per proviso 111A in the case of HUF & Individual being a resident, where the Total Income as reduced by STCG u/s 111A is below the Maximum amount not chargeable to tax (i.e.MANCT or Exemption Limit) than in that case such STCG reduced by remain MANCT shall be taxed at the rate of 10% (its a benefit of technical mistake in language of Act) So in the above case tax implication for AY 2011-12 is as follows: Total income less STCG u/s 111A 600000 – 600000 = 0 MANCT available for STCG u/s 111A 160000/- (and if MANCT available for STCG than Rate is 10% otherwise 15%) Therefor Taxable STCG u/s 111A 600000 – 160000 = 440000/- Tax Rate is equal to 10% Tax on Such STCG u/s 111A 440000*10% = 44000/- Suggestion and Comments most Welcome |
 |
By far, superlative reply.
1. Proviso says you have to look at the residential status
2. proviso was not amended by the Finance Act of 2009. The rate in the proviso is still 10%. You can check against the bare act. However, from an examination perspective, the rate of tax should be taken as 15%.
3. Practically apply 15% to (TOTAL INCOME - Basic Exemption Limit)... do not apply 15% to (GTI - BEL). BEL varies, so dont blindly apply 160K.
Apply 10% if you will contest it before AO. But how will u do it in e-return? No idea.
CAclubindia
