An assessee a senior citizen, has pension income of approx. Rs. 1.80 lacs. He also has LTCG & STCG totalling about 7 lacs. LTCG being 3 lacs & STCG is the balance of Rs. 4 lacs. In this case the unutilized gap of 5% tax up to income of Rs. 5 lacs is Rs 3.20 lacs (5-1.80). In this case the LTCG would be taxed @ 10% after considering initial exemption of Rs. 1 lacs & STCG would be taxed at 15%. Due to non-availability of income taxable at normal rates, can the gap of Rs. 3.20 lacs be first used to calculate STCG tax @ 5%, instead of 15%, and avail the benefit of gap, with lower tax rate, & balance STCG @ 15%. LTCG would continue to be taxed at 10%.
Thanks in advance for the reply.
CAclubindia
