Treatment of STCL and STCG under ITR-2 (New Regime) for AY 2025-26

ITR 1594 views 2 replies

asif mohammed

0 Points Posted on 23 July 2025

Dear Members,

I am an individual taxpayer below 60 years of age and have opted for the new tax regime for AY 2025–26. I am using the official ITR-2 utility to file my return. My income details are as follows:

Interest and Dividend Income: ₹1,50,000

Short-Term Capital Gain (STCG) under Section 111A (realized on or before 22nd July 2024): ₹9,50,000

Short-Term Capital Loss (STCL) on equity shares (incurred on or after 23rd July 2024): ₹7,00,000

STCG taxable at slab rate (non-111A assets): ₹5,00,000

I have the following queries:

Will the ITR-2 utility automatically adjust the STCL of ₹7,00,000 against the STCG of ₹9,50,000 taxed @ 15% (under Section 111A), or will it offset it against the ₹5,00,000 STCG taxed at slab rate?

Is it permissible to not claim the STCL in the current AY and instead carry it forward to future years?
If yes, what is the correct way to report this in the ITR-2 utility to ensure that the return is accepted without error, and the loss is available for carry forward?

Your guidance on the correct reporting procedure and treatment of such losses under the Income Tax Act would be highly appreciated.

Replies (2)

Rama chary Rachakonda

Master in Accounts & high court Advocate

9615 Points Posted on 23 July 2025

The ITR-2A utility will adjust the STCL against the STCG taxable at slab rate first and then against the STCG under Section 111A. It is permissible to carry forward unadjusted STCL to future years, and the correct way to report this is by ensuring accurate details in the ITR-2 utility.

Tax Garden

Tax Consultant

657 Points Posted on 07 May 2026

The new tax regime does not change the capital gains set-off rules. In ITR-2, your STCL from this year can be set off against STCG in Schedule CG, and the ITR-2 utility handles this automatically when you enter figures correctly. STCL can be set off against any STCG (whether taxable at 15% under Section 111A or at slab rates) and also against LTCG.
What the new regime removes is deductions like 80C, HRA, and similar, but Sections 70-74 on capital loss carry-forward and set-off are fully intact. If STCL is not absorbed in the current year, it can be carried forward for 8 assessment years.