Accountal of security transaction tax

 

We invested in UTI balanced fund and sold the units after 5 years. While sending the proceeds UTI has deducted Security transaction tax.Now the question is whether security transaction tax needs to be separately accounted or only net proceeds only to be considered for arriving the profit for accountal purpose.

Say for example the cost of units   100

now sold at    120

STT deducted  0.30

net proceeds received 119.70

whether my profit on sale of investments is Rs.19.70 (by considering net proceeds)

or 20 (Gross) but to show 0.30 as other taxes paid. Can any body suggest ?

Sreenivasulu.P

 

 

Replies (3)
Your Sale value should be grossed up and not Net Value. The STT deducion should be shown under expenditure but which is not an allowable expenditure. Meanwhile you can claim Relief u/s 88E.
Hi, Accounting treatment suggested by Ravikumar is correct. But regarding claiming of relief u/s 88E, it is eligible only IF you are offering profit on sale of Units under the head "“Profits and gains of business or profession”. IF you are offering profit on sale of Units under the head " Capital Gains" , no Relief u/s 88 E is available.

Sir, Please give me format of CMA Data for New manufacturing industrial fof bank finance

Thanking You

Khot  T B

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