Capital gain
This query is : Resolved
SURENDRA KUMAR BUNKAR
(Querist)
10 February 2012
can we do share Trading business without conversion of investment in share into stock under income tax and what is tax consequence on the same transaction
CA PARAS BAFNA
(Expert)
10 February 2012
In case capital asset is converted into stock in trade, as per Section 45(2) the Fair market value of such asset is deemed as sales consideration for the purpose of computing capital gains.
.
Capital Gain becomes taxable in the year of actula sale of the asset
.
When the capital asset is actually transferred such capital Gain as well as
profit arising on such transfer are taxable .
However , if the quantity traded is not significant,in your case,
it may continued to be shown as capital asset only.
.
Capital Gain becomes taxable in the year of actula sale of the asset
.
When the capital asset is actually transferred such capital Gain as well as
profit arising on such transfer are taxable .
However , if the quantity traded is not significant,in your case,
it may continued to be shown as capital asset only.
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