Know all about capital gains from shares, equity and debt mutual funds, bonds, debentures

Long-term capital gains (LTCG): Capital gain on sale of listed securities (other than a unit), or a unit of UTI/ equity-oriented fund, or a zero-coupon bond held for more than 12 months is treated as LTCG. Unlisted share of a company and immovable property (land/ building) have to be held for more than 24 months to qualify for LTCG. In all other types of capital assets, sale after 36 months will qualify as LTCG.

Short-term capital gains (STCG): Gains made on securities (listed other than units/equity-oriented MF/units of UTI/zero coupon bonds) held for up to a year, or capital assets held for 24/36 months qualify as STCG.

Know all about capital gains

*Exemption available if securities transaction tax paid on sale and STT also paid on purchase, in case of equity shares acquired on or after Oct 1, 2004 (subject to certain exceptions notified)
**If STT of 0.1% each is paid by seller and buyer in both cases
*** If STT of 0.001% is paid by seller STT rates mentioned above are for delivery-based transactions only

SET-OFF PROVISIONS FOR CAPITAL LOSSES ARE RATHER RESTRICTIVE

• Loss from transfer of a long-term capital asset can be set off against gain from transfer of any other long-term capital asset in the same year. But, long-term capital loss cannot be set off against short-term capital gains
• Loss from transfer of a short-term capital asset can be set off against gain from transfer of any other capital asset in the same year
• Any unutilised capital loss after absorption in the same year can be further carried forward to next eight years and be utilised under the same conditions as above
• You should file your I-T return with the tax authorities before July 31 to carry forward any losses
• There are certain restrictions on set-off of carry-forward loss under the new ‘simplified’ personal income tax regime