Setoff of Capital gain Loss
This query is : Resolved
BIJAY MITTAL
(Querist)
13 May 2008
An assessee earns a salary income of Rs.7,50,000 per annum after deduction of all the statutory Liablity like P.f.Profession tax etc.During the year he suffers loss from share transaction business for Rs 1,50,000.Can he setoff the loss from salary income.Please also guide some tax planning to reduce the tax liability from salary income.
Amit Sharma
(Expert)
13 May 2008
Dear Bijay,
Short term capital loss can be set off with both short term capital gain and long term capital gain.
Long tem capital loss can be set off only with long term capital gain.
Income from capital is the only head of income which cannot be set off with any other head of income.
Short term capital loss can be set off with both short term capital gain and long term capital gain.
Long tem capital loss can be set off only with long term capital gain.
Income from capital is the only head of income which cannot be set off with any other head of income.
CA Hemant T Dewani
(Expert)
13 May 2008
business loss set off is not available against salary income u/s 71
13 May 2008
I AGREE WITH SRI AMIT SHARMA.
THE INTERHEAD ADJUSTMENT OF SETOFF OF SALRY IS POSSIBLE ONLY WITH LOSS FROM HOUSE PROPERTY.
LONG TERM CAPITAL LOSS CAN ONLY BE SET OFF AGAINST LONG TERM CAPITAL GAIN.
S.T CAPITAL LOSS CAN BE SET OFF AGAINST BOTH S.T&L.T CAPITAL GAIN.
AS FOR TAX PLANNING OF SALARY,YOU MAY BREAK UP SALARY INTO HRA,WHERE LEAST OF THE 3 IS EXEMPT.
ACTUAL HRA
EXCESS OF RENT OVER 10% OF SALARY
50%OF SALARY IN METROS
OR 40 % SALARY IN NONMETROS
TRANSPORT ALLOWANCE CLAIMED UP TO RS 800 PER MONTH AS PART OF SALARY.THIS IS EXEMPT.
CHILDREN EDUCATION ALLOWANCE @100 PERCHILD PER MONTH UP TO TWO CHILDREN CAN BE CLAIMED AS EXEMPT.
MEDICLAIM U/S80 D CAN BE CLAIMED UPTO RS15000/P.A NOW FROM CURRENT FIN. YEAR ANOTHER RS150000/FOR PARENTS CAN ALSO BE CLAIMED AS EXEMPT.
IF ONE HAS INCOME FROM HOUSE PROPERTY OR SELF OCCUPIED PROPERTY CARRYING LOANS, 80 C DEDUCTION FOR PRINCIPAL(MAX RS ONE LAKH P.A) AND EXEMPTION ON INTEREST CAN BE CLAIMED LIMITLESS FOR LETOUT PROPERTY AND UPTO RS.150000/P.A FOR SELF OCCUPIED PROPERTY WHICH REDUCE SALARY TAX BURDEN TO A SIGNIFICANT EXTENT.
IF THE SERVICE TERMS PROVIDE MEDICAL REIMBURSEMENTS CAN BE CLAIMED EXEMPT UPTO RS. 15000/P.A.
YOU HAVE A BIG BASKET OF TAX SAVINGS UNDER SEC80 C(TOTAL DEDUCTION LIMITED TO RS ONE LAKH) LIKE LIC,NSC,TUTION FEES OF CHILDREN,PPF, SCH.BANK DEPOSITS FOR 5 YEARS.ETC...
NEW SAVINGS ALSO ADDED UNDER 80 C IN BUDGET 08 LIKE 5 YEAR POST OFFICE TIME DEPOSITS .
R.V.RAO
THE INTERHEAD ADJUSTMENT OF SETOFF OF SALRY IS POSSIBLE ONLY WITH LOSS FROM HOUSE PROPERTY.
LONG TERM CAPITAL LOSS CAN ONLY BE SET OFF AGAINST LONG TERM CAPITAL GAIN.
S.T CAPITAL LOSS CAN BE SET OFF AGAINST BOTH S.T&L.T CAPITAL GAIN.
AS FOR TAX PLANNING OF SALARY,YOU MAY BREAK UP SALARY INTO HRA,WHERE LEAST OF THE 3 IS EXEMPT.
ACTUAL HRA
EXCESS OF RENT OVER 10% OF SALARY
50%OF SALARY IN METROS
OR 40 % SALARY IN NONMETROS
TRANSPORT ALLOWANCE CLAIMED UP TO RS 800 PER MONTH AS PART OF SALARY.THIS IS EXEMPT.
CHILDREN EDUCATION ALLOWANCE @100 PERCHILD PER MONTH UP TO TWO CHILDREN CAN BE CLAIMED AS EXEMPT.
MEDICLAIM U/S80 D CAN BE CLAIMED UPTO RS15000/P.A NOW FROM CURRENT FIN. YEAR ANOTHER RS150000/FOR PARENTS CAN ALSO BE CLAIMED AS EXEMPT.
IF ONE HAS INCOME FROM HOUSE PROPERTY OR SELF OCCUPIED PROPERTY CARRYING LOANS, 80 C DEDUCTION FOR PRINCIPAL(MAX RS ONE LAKH P.A) AND EXEMPTION ON INTEREST CAN BE CLAIMED LIMITLESS FOR LETOUT PROPERTY AND UPTO RS.150000/P.A FOR SELF OCCUPIED PROPERTY WHICH REDUCE SALARY TAX BURDEN TO A SIGNIFICANT EXTENT.
IF THE SERVICE TERMS PROVIDE MEDICAL REIMBURSEMENTS CAN BE CLAIMED EXEMPT UPTO RS. 15000/P.A.
YOU HAVE A BIG BASKET OF TAX SAVINGS UNDER SEC80 C(TOTAL DEDUCTION LIMITED TO RS ONE LAKH) LIKE LIC,NSC,TUTION FEES OF CHILDREN,PPF, SCH.BANK DEPOSITS FOR 5 YEARS.ETC...
NEW SAVINGS ALSO ADDED UNDER 80 C IN BUDGET 08 LIKE 5 YEAR POST OFFICE TIME DEPOSITS .
R.V.RAO
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