Capital gain tax

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

28 September 2016 Please advise me whether if my father has occasionally trade in shares and gain short term capital gain and if his total income is not taxable then should he be required to pay short term capital gain tax @ 15% i.e. at special rate or since his total income is not taxable then no tax. Please reply with preferably quoting secion.
And my second query is there any long term capital gain tax for sale of ELSS mutual fund beyond 1 year.

thanks in advance

CA SAGAR M. AHUJA

CA SAGAR M. AHUJA (Expert)
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28 September 2016 1. No Your father do not need to pay tax at 15% on gain if his income is not cross the basic exemption limit
As per the provision of Section 111A......................
Only a resident individual and resident HUF can adjust the exemption limit against STCG covered under section 111A. Thus, a non-resident individual/HUF cannot adjust the exemption limit against STCG covered under section 111A.
A resident individual/HUF can adjust the STCG covered under section 111A against the basic exemption limit but such adjustment is possible only after making adjustment of other income. In other words, first income other than STCG covered under section 111A is to be adjusted against the exemption limit and then the remaining limit (if any) can be adjusted against STCG covered under section 111A.
2. LTCG is tax-free for equity mutual funds under section 10(38).If the holding period of Mutual Fund exceeds 1 year, then it is categorized as Long Term asset and there will be no tax at the time of redemption of mutual fund units.
Thanks.

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