Taxability of income

659 views 2 replies

Hi,

My query is regarding capital gains & tax liability thereon.

Suppose, status of A is -Major individual(not senior citizen) has joint DEMAT account with B wherein first name is of A. A is not having any source of income but B is earning income by way of other sources etc. A invests in shares (in listed shares on recognised stock exchange) and makes short term capital gains which total amounts to less than 10000. since A is not having any other income his total income will fall below slab & Short term capital gains are taxed as per slab rates, this is being gains on shares will it chargeable to tax? Is A is required to pay any tax , if any How? Should A file the IT return? 

regds 

Replies (2)

Dear Sonal,

Short Term Capital gain is taxed at Flat Rate specified by CBTD.

In case of an individual or HUF, being a resident, where the total income as reduced by such short term capital gains is below the basic exemption limit, then the short term capital gain shall be reduced by the amount of basic exemptiom limit not exhausted by any other income and only the balance short term capital gain shall be chargeable to tax at the rate specifie by CBDT.

So in present case A will not be taxed as STCG is below basic exemtion limit.

Please reply if you find else to update my knowledge,

Regards,

Prakash....

Dear Sonal,

Mr Prakash is right this way.

STCG taxed as Flat rate @ 15%

But it should not be taxable if assesse total income arises only through the STCG from share it has allowed basic exemption limit form such income but it has not allowed any Deduction under Chapter VI from such income.

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