I am a bit weak on taxes. But I will try to answer your question...I think capital gains tax cannot be aggregated in that manner. If you have captial gains from a transaction, you have to pay the tax on those gains. If another transaction results in loss, you will not be liable for capital gain tax and it will be zero for that transaction. So in your example, the person still has to pay a tax of Rs 1000.
On Thu, Nov 11, 2010 at 5:11 PM, Prashant R wrote:
I have a query regarding the short term capital gain tax. Suppose a person earns around Rs 10000 as short term capital gain in FY 11. Suppose he buys a share in the same financial year of a company. (Name of company ABC , share price RS 100, Qty 50) So total buying is Rs 5000. If this company gives bonus shares in the ratio 1:1. So now the investor is having 200 No of shares of company ABC. He sells 100 No of shares at Rs 29. So technically his loss will be Rs 2100 (5000-2900). So my question is whether he can adjust these 2100 rs loss against Rs 10000 profit. So his net profit will be Rs 7100 (10000-2900). So in this case he has to pay tax Rs 710 instead of Rs 1000. Whether this is allowed.
I am not sure about it and different people are giving different opinions about this. Pls let me know if you know the right answer.
capital gain tax will be on total net capital gain with all transaction in a financial year for example 20000 gain from 7 transaction and 14000 loss in 3 transaction in one fin yr than tax will be on 20000-14000=6000 for that fin year
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