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Stcg u/s 111a

Arihant (Business) (207 Points)

14 July 2012

What will be tax liablity in following case :

STCG u/s 111A Rs. 2,20,000

Interest income Rs. 80,000

Investments u/s 80C Rs. 1,00,000

in case of resident male individual and what will be your reply if there is also a LTCG (other than shares) of Rs. 80,000.

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6 Replies

Mayank Mall (CA-Final) (316 Points)
Replied 15 July 2012

Tax on STCG u/s 111A = 10% of 2,20,000 = 22000

Interest Income is Fully Taxable so will be included in your business or income from other sources head.

Investment will be deducted in full (1L) if you have not taken any decution u/s 80C prior to current year.

Tax on LTCG = 20% of 80000 = 16000

Arihant (Business) (207 Points)
Replied 17 July 2012

Dear Mayank,

Under 111A, it is mentioned "(2) Where the gross total income of an assessee includes any short-term capital gains referred to in sub-section (1), the deduction under Chapter VI-A shall be allowed from the gross total income as reduced by such capital gains." then dedcution should be allowed only upto Rs.80,000 u/s 80C ?

Arihant (Business) (207 Points)
Replied 18 July 2012

can anyone pl clarify on above ?

Archana Das (CA Final student) (622 Points)
Replied 18 July 2012

@ Prince you r rite dedction wil be available for only 80,000

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Mayank Mall (CA-Final) (316 Points)
Replied 18 July 2012

Am Sorry Sir,

I did not know about this, Infact I tried reading it again but couldn't find such a clause.....either I am missing it or maybe it isn't right now in my part of studies.

Sorry for the Mislead !!!

CA.Varalakshmi.M (Manager-Finance) (482 Points)
Replied 18 July 2012

Originally posted by : Prince

What will be tax liablity in following case :

STCG u/s 111A Rs. 2,20,000 is taxable at a flat rate of 15% but that in the case of an individual or a Hindu undivided family, being a resident, where the total income as reduced by such short-term capital gains is below the maximum amount which is not chargeable to income-tax, then, such short-term capital gains shall be reduced by the amount by which the total income as so reduced falls short of the maximum amount which is not chargeable to income-tax and the tax on the balance of such short-term capital gains shall be computed at the rate of 15 per cent.

So Tax is on 40000*15%

Interest income Rs. 80,000

Investments u/s 80C Rs. 1,00,000 deduction is available upto Rs.80000/- only