Capital gains in NONLISTED NON CAPITAL PROTECTED MLD WHERE TO FILL IN ITR3
This query is : Resolved
15 October 2023
I HAVE LTCG IN NIFTY ACCELERATOR PLUS 132 MLD BY NBFC . IT IS NONLISTED NON CAPITAL PROTECTED NIFTY LINKED MLD REDEEMED ATER 3 YEARS BUT BEFORE MATURITY' WHAT IS TAXATION STATUS AS PER NEW AMMENDMENT. I READ UNLISTED NON CAPITAL PROTECTED MLD ARE NOT DEBT SECURITIES BY DEFINITION OF SEBI. SO CAN I SHOW IT AS LTCG FROM OTHER THAN UNQUOTED SHARES IN ITR 3 AND TAKE INDEXATION BENIFIT
06 July 2024
If you have Long Term Capital Gains (LTCG) from a Non-Listed Non-Capital Protected Nifty Linked Market Linked Debenture (MLD) redeemed after 3 years but before maturity, here's how it typically gets taxed based on the recent amendments and current tax laws in India:
### Taxation Status:
1. **Nature of Investment:**
- Non-Listed Non-Capital Protected MLDs are treated as capital assets for taxation purposes.
2. **Tax Treatment:**
- **Capital Gains Classification:** Since it's a non-capital protected MLD, the gains will be classified as capital gains.
- **Long-Term or Short-Term:** If held for more than 3 years, gains are considered Long-Term Capital Gains (LTCG).
3. **Indexation Benefit:**
- **Applicability:** Yes, you can avail of indexation benefit for calculating LTCG tax.
- **Indexation Method:** Adjust the purchase price of the MLD using the Cost Inflation Index (CII) of the year of purchase and the year of sale/redemption to factor in inflation. This reduces the taxable LTCG.
4. **ITR Filing:**
- You should report this income under the head "Capital Gains" in your Income Tax Return (ITR), specifically in Schedule CG (Capital Gains).
- Mention the nature of asset as "Other than Quoted Shares or Securities".
5. **Tax Rate:**
- LTCG from non-listed securities like MLDs is taxed at 20% with indexation benefit.
### Steps to Report in ITR:
- **Schedule CG:** Enter details of the sale/redemption of the MLD, including sale consideration, cost of acquisition adjusted for indexation, and resulting LTCG.
- **Specify Nature of Asset:** Indicate that it's "Other than Quoted Shares or Securities".
- **Tax Computation:** Calculate tax on LTCG at 20% after applying indexation benefit.
### Note:
- Ensure to keep documentation related to purchase, redemption, and indexation calculations for audit and future reference.
- It's recommended to consult with a tax advisor or chartered accountant to ensure compliance with current tax laws and accurate reporting in your ITR.
By following these guidelines, you can appropriately report and benefit from indexation on your LTCG from the Non-Listed Non-Capital Protected Nifty Linked MLD in your ITR.
### Taxation Status:
1. **Nature of Investment:**
- Non-Listed Non-Capital Protected MLDs are treated as capital assets for taxation purposes.
2. **Tax Treatment:**
- **Capital Gains Classification:** Since it's a non-capital protected MLD, the gains will be classified as capital gains.
- **Long-Term or Short-Term:** If held for more than 3 years, gains are considered Long-Term Capital Gains (LTCG).
3. **Indexation Benefit:**
- **Applicability:** Yes, you can avail of indexation benefit for calculating LTCG tax.
- **Indexation Method:** Adjust the purchase price of the MLD using the Cost Inflation Index (CII) of the year of purchase and the year of sale/redemption to factor in inflation. This reduces the taxable LTCG.
4. **ITR Filing:**
- You should report this income under the head "Capital Gains" in your Income Tax Return (ITR), specifically in Schedule CG (Capital Gains).
- Mention the nature of asset as "Other than Quoted Shares or Securities".
5. **Tax Rate:**
- LTCG from non-listed securities like MLDs is taxed at 20% with indexation benefit.
### Steps to Report in ITR:
- **Schedule CG:** Enter details of the sale/redemption of the MLD, including sale consideration, cost of acquisition adjusted for indexation, and resulting LTCG.
- **Specify Nature of Asset:** Indicate that it's "Other than Quoted Shares or Securities".
- **Tax Computation:** Calculate tax on LTCG at 20% after applying indexation benefit.
### Note:
- Ensure to keep documentation related to purchase, redemption, and indexation calculations for audit and future reference.
- It's recommended to consult with a tax advisor or chartered accountant to ensure compliance with current tax laws and accurate reporting in your ITR.
By following these guidelines, you can appropriately report and benefit from indexation on your LTCG from the Non-Listed Non-Capital Protected Nifty Linked MLD in your ITR.
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- CG Tax On residential property
- Post Office RD Interest
- Applicable TDS for Purchase of Flat from NRI
- Claiming exemption of perquisite for employee-owned car under New Tax Regime in ITR-2
- Eway bill for machinery reparing
- Under construction property in ITR
- Gift of mutual fund units to daughter
- Upload Level ValidationITR3Category of Defect B/D
- Reporting of STCG on Property in ITR
- Not able to file ITR
- ITR-4 vs ITR 5
- PF Taxable Income
- Clarification on Tax Audit Applicability and Reporting of F&O Transactions in ITR-3
- Interest credited in FY2025-2026 & TDS therein by EPFO does not reflect in AIS or Form 26AS
- 44ad eligble money lending interest
- Delisted shares sold in off market/ Rebate u/s87A
- In Exports Sales HSN details where to fill
- Opting out" of regime provided under subsection (1A) of Section 115BAC but Form 10IEA is not filed.
- Difference in tax comparison report
- Gst invoice numbering and delivery challan numbering
Trending Online Classes
-
DT & Audit (Exam Oriented Fastrack Batch) - For May 26 Exams and onwards Full English
CA Bhanwar Borana & CA Shubham Keswani
Subscribe to Pro
Join an elite circle of professionals
CAclubindia
