Bonjour, new guests from small-town India
Puneet Dhawan of Accor is brimming with ideas on ways to revive the hospitality sector
PO13_tax.jpg
I invested in stocks and booked profit of ₹40,000 in the short term by holding them for only three months during the financial year 2015-2016.
My total income for the year 2015-2016 is ₹1,60,000, including the profit from the sale of stocks, which is lower than the taxable limit.
Please advise if I still need to pay tax on the profit from sale of stocks?
B Suresh Kannan
As per the provisions of the Income-Tax Act, 1961, no tax is required to be paid by an individual if his taxable income does not exceed the maximum amount not chargeable to tax (₹2,50,000 for financial year 2015-16).
The benefit of the aforesaid exemption limit is also available for income under short-term capital gains.
As your taxable income other than short-term capital gain is ₹1,20,000, you can utilise the balance exemption limit (₹130,000, that is, ₹250,000 less ₹120,000) against your short-term capital gain of ₹ 40,000, based on which no tax is required to be paid by you for financial year 2015-16.
When I recently sold some units of an equity mutual fund, the fund house deducted some money as capital gains tax along with service tax, securities transaction tax.
I wonder whether fund houses are supposed to deduct capital gains tax while making payments against units sold. I am an NRI and all purchases and sales go through my NRE account.
Rajan
As per the provisions of the Income-Tax Act, 1961, any person responsible for paying any sum to a non-resident which is chargeable to income-tax under the provisions of the Act, is required to deduct tax at the specified rates.
Short-term capital gain from sale of units of equity oriented mutual funds is taxable at 15 per cent whereas long-term capital gain from sale of such units is exempt from tax.
In the light of the limited facts available, I presume that you have earned short-term capital gains and thus the fund house was required to deduct tax at 15 per cent on such capital gains.
Please note that it is only the interest income earned from funds lying in NRE account which is exempt under the Act.
Any income earned out of the investments made through the NRE account shall be taxable subject to other provisions of the Act.
The writer is a practising chartered accountant. Send your queries to taxtalk@thehindu.co.in
Puneet Dhawan of Accor is brimming with ideas on ways to revive the hospitality sector
Citroen’s first vehicle sports a novel design and European interiors. It is also meant to be as comfortable as ...
The pandemic is only the tip of the iceberg that the country’s cash-poor airlines — both regional and national ...
The government is yet to specify the framework of its recently announced old vehicle scrappage policy
Here is a checklist that equips you to discern the market nuances
Sensex, Nifty 50 have witnessed sharp decline
The fund has consistently outperformed S&P BSE 100 TRI over one, three and five years
Returns are superior to immediate annuity plans, but SCSS can secure better rates for new investors sooner if ...
With the public looking beyond mainstream media for reports from the ground, independent digital platforms are ...
The country hasn’t had a quiet moment since the military seized power on February 1
The Tatmadaw sees itself as an embodiment of the nationalist soul of Myanmar. But their brand of nationalism ...
While Supreme Court has cleared the way for women seeking longer tenures and senior roles in the Indian Army, ...
Its name is the starting point of a brand’s journey and can make a big difference in the success sweepstakes
Sober spirits are the in thing
A peek into where ad spends went last year and where they are headed tomorrow
Can Swiggy Instamart disrupt the ecommerce groceries space, currently ruled by the Amazons and Big Baskets? ...
Three years after its inception, compliance with GST procedures remains a headache for exporters, job workers ...
Corporate social responsibility (CSR) initiatives of companies are altering the prospects for wooden toys of ...
Aequs Aerospace to create space for large-scale manufacture of toys at Koppal
And it has every reason to smile. Covid-19 has triggered a consumer shift towards branded products as ...
Please Email the Editor