if Individual has following income do he gets rebate U/s 87A for AY 2026-2027
Normal Income (Salary, Dividend etc) 1130000
LTCG U/s 112A 1800000
STCG 50000
in above case do we get rebate on normal income despite total Income (Including Capital Gain) is 2980000
No, the individual does not get a rebate under Section 87A for AY 2026-27. Although the normal income is ₹11,30,000, the total income including capital gains is ₹29,80,000 (exceeding the ₹12,00,000 limit), and special-rate capital gains (Sections 111A and 112A) are explicitly carved out and ineligible for Section 87A tax relief.
The rebate under Section 87A for AY 2026-27 (new regime) is based on TOTAL INCOME, not just normal income.
Your total income is Rs. 29.80 lakhs, which exceeds the Rs. 12 lakh threshold. So the rebate does NOT apply, even though normal income is within limits.
Two points to keep in mind:
- Capital gains under Section 111A (STCG from listed equity/equity MF) and Section 112A (LTCG) are included in total income for this eligibility check. There is no separate treatment that splits normal income from special rate income for the rebate threshold.
- The capital gains will still be taxed at their special rates: 20% for STCG under 111A, 12.5% for LTCG under 112A above the Rs. 1.25 lakh exemption.
For a full breakdown of how Section 87A works with capital gains in AY 2026-27, this [Section 87A rebate guide for AY 2026-27](https://taxgarden.in/blog/section-87a-rebate-ay-2026-27-eligibility-limit) covers eligibility thresholds and the capital gains interaction in detail.
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