Capital gain tax
This query is : Resolved
Querist : Anonymous
Querist :
Anonymous
(Querist)
15 June 2012
I sold flat Rs 17.50 L in year 2012, with purchase prices Rs 5 L in 2002, the after indexation price Rs 10 L now, after deduction index price form sale, balance Rs 7.5 L, i need to pay capital gain tax on this amount. I had purchase 3000 share with Rs 70 price, now same share price is Rs 18/- , i am in loss of appriximate Rs 1.5 L above for share investment. Can i sale these shares and adjust loss against Capital gain tax calculation, to save the Capital gain tax. Is there any idea, to save Capital gain tax rather than investment in property or bonds as usual method.
Please suggest
Expert advice expected.
Many thanks in advance
Please suggest
Expert advice expected.
Many thanks in advance
16 June 2012
Year 2012 is even though current but some part of it has already become past.
.
In case flat has been sold prior to 31.03.2012, your above planning is not beneficial.
.
In spite of incurring actual losses in shares and lossing 100%, it is better to pay 20% tax or invest for tax savings.
.
However, there is no restriction in setting off of STCL on shares with LTCG on Flat.
.
.
In case flat has been sold prior to 31.03.2012, your above planning is not beneficial.
.
In spite of incurring actual losses in shares and lossing 100%, it is better to pay 20% tax or invest for tax savings.
.
However, there is no restriction in setting off of STCL on shares with LTCG on Flat.
.
Querist : Anonymous
Querist :
Anonymous
(Querist)
16 June 2012
Dear Mr. Paras sir,
I had sold after 31.3.2012 ( May 2012),As , I heard that loss in shares can be adjusted in Capital Gain profit of property.As, i need sale share for 1 days , next day i can buy it, with new price. So, it will new purchase of sale with new price. I already booked by my loss in shares, same loss can be adjusted in CAPITLA GAIN of property for that year. Only, I need pay 1 days share prices fluctuation rate and broker charges on transaction.
Please suggest.
I had sold after 31.3.2012 ( May 2012),As , I heard that loss in shares can be adjusted in Capital Gain profit of property.As, i need sale share for 1 days , next day i can buy it, with new price. So, it will new purchase of sale with new price. I already booked by my loss in shares, same loss can be adjusted in CAPITLA GAIN of property for that year. Only, I need pay 1 days share prices fluctuation rate and broker charges on transaction.
Please suggest.
18 July 2024
Yes, you can adjust the short-term capital loss from shares against the long-term capital gains from the sale of property in the same financial year under the provisions of the Income Tax Act, 1961. Here’s how it works:
### Capital Gains and Losses Adjustment:
1. **Capital Gains from Property:**
- Since you sold the property in May 2012, any gains arising from this sale would be classified as long-term capital gains (LTCG) if the property was held for more than 3 years.
2. **Capital Loss from Shares:**
- If you incurred a capital loss from selling shares within the same financial year (April 1, 2012 to March 31, 2013), this loss can be set off against the LTCG from the property sale.
3. **Conditions for Set-off:**
- **Same Financial Year:** The capital loss from shares must be booked in the same financial year as the capital gains from property.
- **Type of Capital Gains:** Since property gains are LTCG, you can set off both short-term and long-term capital losses from shares against LTCG from property.
- **Netting Off:** After setting off the capital loss from shares against LTCG from property, if any capital loss remains unadjusted, it can be carried forward to future years (up to 8 assessment years) to set off against capital gains in those years.
4. **Procedure:**
- Report the capital gain from the property sale in your income tax return (ITR).
- Report the capital loss from shares separately in the appropriate schedule of the ITR.
- The ITR form will calculate the taxable LTCG after setting off the capital loss from shares, resulting in a lower taxable capital gain amount.
5. **Brokerage and Transaction Charges:**
- The brokerage charges and transaction fees incurred for selling the shares can be added to the cost of acquisition of the shares. This adjusted cost will then determine the actual capital loss incurred on the shares.
### Conclusion:
You can indeed utilize the short-term capital loss from shares sold within the same financial year to offset the long-term capital gains from the sale of property. Ensure to document all transactions and seek assistance from a tax advisor to correctly report these transactions in your income tax return to avail the benefit of capital gains tax set-off effectively.
### Capital Gains and Losses Adjustment:
1. **Capital Gains from Property:**
- Since you sold the property in May 2012, any gains arising from this sale would be classified as long-term capital gains (LTCG) if the property was held for more than 3 years.
2. **Capital Loss from Shares:**
- If you incurred a capital loss from selling shares within the same financial year (April 1, 2012 to March 31, 2013), this loss can be set off against the LTCG from the property sale.
3. **Conditions for Set-off:**
- **Same Financial Year:** The capital loss from shares must be booked in the same financial year as the capital gains from property.
- **Type of Capital Gains:** Since property gains are LTCG, you can set off both short-term and long-term capital losses from shares against LTCG from property.
- **Netting Off:** After setting off the capital loss from shares against LTCG from property, if any capital loss remains unadjusted, it can be carried forward to future years (up to 8 assessment years) to set off against capital gains in those years.
4. **Procedure:**
- Report the capital gain from the property sale in your income tax return (ITR).
- Report the capital loss from shares separately in the appropriate schedule of the ITR.
- The ITR form will calculate the taxable LTCG after setting off the capital loss from shares, resulting in a lower taxable capital gain amount.
5. **Brokerage and Transaction Charges:**
- The brokerage charges and transaction fees incurred for selling the shares can be added to the cost of acquisition of the shares. This adjusted cost will then determine the actual capital loss incurred on the shares.
### Conclusion:
You can indeed utilize the short-term capital loss from shares sold within the same financial year to offset the long-term capital gains from the sale of property. Ensure to document all transactions and seek assistance from a tax advisor to correctly report these transactions in your income tax return to avail the benefit of capital gains tax set-off effectively.
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