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Our professional team can assist you not only in filing your tax returns but also for better tax planning and management for all types of income including salary, House property, capital gains (stocks and investments) etc. Starting from Rs 500/- only

Capital Gain:

Any profit earned on transfer of a capital asset (such as shares in companies, property etc) is chargeable to income tax. Certain goods such as assets of personal effects like furniture for personal use are not treated as capital assets for the purpose of income tax and hence no liability of tax arises on transfer of such assets.

The tax rate on capital gains depend upon the nature of capital asset transferred. If a capital asset is held for less than 36 months (12 months in cases like equity shares, units of UTI etc.), it is termed as “Short term capital asset” and any gain on transfer of such short term capital asset is taxed at the normal slab rate applicable to the assessee/transferor.  An asset which is not a “short term capital asset” is termed as “Long term capital asset” and is taxed at the rate of 20% (or 0% like in cases of listed equity shares, if certain conditions are fulfilled).

The gain on transfer of capital asset is calculated by subtracting cost of acquisition /improvement (or indexed cost of acquisition/improvement) and other expenditures related to transfer from the full value of consideration/sale price. Indexed cost of acquisition/improvement is allowed in case of long term capital assets, which covers the increase in inflation over the years when the asset was purchased and when the asset is sold and is calculated based upon the cost inflation index notified by the central government each year.

Income tax Act also allows exemptions from paying tax on capital gains in cases when assessee/transferor has made investments in specified assets and followed the conditions mentioned in the Act and rules made thereunder.