Expense limits & deductions allowed on cost of acquisition sale of shares

Tax queries 265 views 4 replies

Vijay

Tax payer

27 Points Joined July 2018

Hi, I have a few quesitons on the computaiton of capital gains arising out of purchase and sale of shares - STCG:

1. I have subscribed to a professional recommedndation service [equitymaster.com] for advice on buying and selling of shares. Can I claim the fee I pay to them as expense on sale and purchase of shares?

2. Are there any limits on what is the maximum expense that can be claimed on the transfer of shares? This quesiton is probably only relevant if the answer to the above question is Yes as it may happen that I have made a profit of 5000 in selling shares but paid 7000 as Financial advisor fee. Can I claim a loss in this case?

Thanks

Replies (4)

Dhirajlal Rambhia

SEO Sai Gr. Hosp.

208241 Points Joined July 2016

Try to understand difference between STCG/LTCG and profits and gains from business......

Once that is clear in mind...... your query gets resolved....

Vijay

Tax payer

27 Points Joined July 2018

Sorry sir, but because I am not able to understand it , thats why I asked the quesiton on the forum. I am a taxpayer and hence not an expert on tax laws.

Dhirajlal Rambhia

SEO Sai Gr. Hosp.

208241 Points Joined July 2016

If your treatment of the transactions is business nature, and not investment; you are allowed to deduct all the expenses related to the business....... then there will not be STCG/STCL but profits & loss from the business.

Vijay

Tax payer

27 Points Joined July 2018

Originally posted by : Dhirajlal Rambhia
	If your treatment of the transactions is business nature, and not investment; you are allowed to deduct all the expenses related to the business....... then there will not be STCG/STCL but profits & loss from the business.

My transactions are investment and not business in nature. I am an individual who is into buying and selling of shares for investment purpose. Does that mean that this deduction is not allowed? Please confirm.

Sorry , I re-read your statement and its clear that this is not allowed for investment, Thanks for the help.