Itr-2 questions on cg on nasdaq stock and property share

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

18 June 2012 Hello tax experts -

I have two questions - one on property share (new in ITR-2 this year) and one on short vs long term capital gains on NASDAQ stock sold (part of company given stock units).

1. Property share - I own a flat which has both my and my wife's names on the agreement/registration. Until now, I always included the flat only on my income tax return under House property and included all rental income from it part of my return only. My wife's return (which includes only bank interest on her unclubbed money, she has no regular income).

Now that I need to specify property share, here is what I plan to do - please correct me if I'm wrong: I'll have the flat shown in both my and my wife's return as 50% shares. Rental income I'll include fully in my return. I will include 50% of that rent part of the clubbing section on my return. No mention of rent on my wife's return. Is this the right way of representing this?

2. Capital gains on NASDAQ stock - part of my compensation, I get stock units of my company stock traded on NASDAQ. The tax on the vesting amount is paid by company by selling some stocks at vesting and accounting for this part of salary and tax every month. I need to pay tax on the capital gains of anything made over and above the vesting price. I sold some stock last year - some of it had vested over 12 months since then, some of it was less than 12 months.

I'd like to know:
- how much of this should be considered short term capital gains (taxed at 30% for NASDAQ stock, right?)
- how much of this should be considered long term capital gains (taxed at 20% for NASDAQ stock, right?)
- where exactly on ITR-2 should these two amounts appear as income?

Thanks a lot in advance.

Regards
RK

Querist : Anonymous

Querist : Anonymous (Querist)

20 June 2012 please any insights?

Aashok Kumar Sharma

Aashok Kumar Sharma (Expert)
Follow

02 August 2024 Let's address your questions one by one regarding property share and capital gains from NASDAQ stocks in the context of filing ITR-2.

### 1. Property Share and Rental Income

#### **How to Handle the Flat and Rental Income:**

**Property Share:**

- **Joint Ownership:** Since the flat is co-owned by both you and your wife, you should correctly reflect the share of ownership and rental income in both returns.

- **Rental Income Reporting:**
- **Your Return:** Report the entire rental income in your return.
- **Wife's Return:** Report 50% of the rental income in her return.

**Steps to Follow:**
- **For Your Return:**
- **Income from House Property:** Report the entire rental income under "Income from House Property."
- **Clubbing Section:** Since you’re including 50% of the rental income in your wife’s return, you need to include 50% of the rental income in the “Clubbing of Income” section in your return. This is because, under the clubbing provisions, the rental income is shared.

- **For Your Wife's Return:**
- **Income from House Property:** Report 50% of the rental income. Do not include any other income related to the property.

**Summary:**
- **Your Return:** 100% of rental income reported, and 50% of that amount is included in the clubbing section.
- **Wife's Return:** 50% of the rental income reported as her income.

### 2. Capital Gains on NASDAQ Stock

#### **Handling Capital Gains:**

**Short-Term vs. Long-Term Capital Gains:**

- **Short-Term Capital Gains (STCG):** Gains on stocks sold within 12 months of acquisition.
- **Long-Term Capital Gains (LTCG):** Gains on stocks held for more than 12 months from the date of acquisition.

For NASDAQ stocks, the treatment is:
- **STCG:** Taxed at 30% plus applicable surcharge and cess.
- **LTCG:** Taxed at 20% with indexation benefit (or 10% without indexation, if the stocks are acquired on or after February 1, 2018, and sold after March 31, 2018).

**Where to Report in ITR-2:**

**Schedule CG:**

- **Part A – Short Term Capital Gains:**
- **Column 3:** Enter the details of short-term capital gains.
- **Column 4:** Enter the amount of STCG, and it will be taxed at 30% plus surcharge and cess.

- **Part B – Long Term Capital Gains:**
- **Column 3:** Enter the details of long-term capital gains.
- **Column 4:** Enter the amount of LTCG. This will be taxed at 20% with indexation or 10% without indexation.

**Steps to Follow:**

1. **Determine the Holding Period:**
- Calculate the holding period for each stock sold. If the holding period is 12 months or less, it is STCG. If more than 12 months, it is LTCG.

2. **Fill Schedule CG:**
- **Part A – STCG:**
- Report short-term capital gains in Part A of Schedule CG.
- **Columns:** Include details like sales consideration, cost of acquisition, and the resultant gain.

- **Part B – LTCG:**
- Report long-term capital gains in Part B of Schedule CG.
- **Columns:** Include details like sales consideration, cost of acquisition, and the resultant gain with indexation (if applicable).

**Example:**
- **Short-Term Capital Gains (STCG):**
- Sold stocks within 12 months.
- Report in **Part A** of Schedule CG.

- **Long-Term Capital Gains (LTCG):**
- Sold stocks after holding them for more than 12 months.
- Report in **Part B** of Schedule CG.

### **Summary:**

- **Property Share:** Report full rental income in your return, 50% in your wife’s return, and handle the clubbing provisions accordingly.
- **NASDAQ Stock Gains:** Report STCG and LTCG in their respective sections in Schedule CG of ITR-2.

Ensure to cross-check these details with the latest ITR-2 utility to make sure all fields are correctly filled and validated. If needed, consult a tax professional to ensure compliance and accuracy.

You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now

Summarize this with AI

ChatGPT Perplexity Claude Google AI Grok