Section 111&112

how we calculate capital gain under section 111&112
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Under Section 111A, an assesses is required to file a tax at the rate of 15% on the capital gained by him on short-term capital assets defined under Section 2 (42A) of the Income Tax Act, 1961. The listed securities on which Securities Transaction Tax is applicable comes under this section like listed equity shares, listed mutual funds and listed units of business trusts.

The benefits of the slabs do not apply to the Non-Residents of India (NRIs). The deductions under Section VI-A are not provided under Section 111A.

Section 111A Exceptions:

Shares listed in the recognized Stock Exchange in International Financial Service Center (IFSC) as Securities Transaction Tax (STT) is not charged on the transfer of such securities. If the assessee proves that the securities held by him are Capital assets and not Stock in Trade. Foreign Institutional Investors (FII) are also not included as the securities held by them are indeed Capital Assets and there is no requirement of proving the same.

Section 112 of the Income Tax Act

Under Section 112 of the Income Tax Act, an assesses is required to pay a tax at the rate of 20% or 10% after and before indexation respectively on the capital gained by him on long-term capital assets defined under Section 2 (29A) of the IT Act, 1961. All the securities whether listed or not whether shares, debentures, or units of a business trust are applicable under this section.

The deductions under Section VI-A are not provided under Section 112.
Section 112 Exceptions: No tax on gains from Mutual Funds  If Section 112A is applicable than Section 112 does not imply.  Not applicable to Non-Residents of India (NRIs)

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