STCG/LTCG below total income 5L.

[Batman]

I thought I knew the answer, but a friend says otherwise so I need to ask -

Does STCG/LTCG depend on total income? For example, if the total income is <5L, does that person not pay any tax?

I always thought it was a flat 15%/10%, not matter the other income sources.

Please share a link so that I can verify to my friend as well.

 

[sxchzy]

STCG /LTCG is added to total taxable income and charged based on your tax slab
so for incomes below 5L no tax irrespective of income source

 

[Batman]

STCG /LTCG is added to total taxable income and charged based on your tax slab
so for incomes below 5L no tax irrespective of income source

Thanks @sxchzy, could you please share a link of any reputable source, so that I can verify this to my friend as well?

I googled but I may have used the incorrect keywords, I didn't find anything.

 

[sourpai]

Some corrections... STGC is not exempted from Tax. It can get exempted if you show STGC as business income in ITR and it is less than 5L. For this, you will need to fill in ITR3

For LTGC exemption is there till 1L of booked long term gains per year. Above 1L it will be taxed irrespective of your other incomes

 

[Batman]

Some corrections... STGC is not exempted from Tax. It can get exempted if you show STGC as business income in ITR and it is less than 5L. For this, you will need to fill in ITR3

For LTGC exemption is there till 1L of booked long term gains per year. Above 1L it will be taxed irrespective of your other incomes

Yes, this is what I remember reading. If possible, please please share a link to verify that stcg and ltcg are not based on total income.

Thank you so much.

 

[sxchzy]

Thanks @sxchzy, could you please share a link of any reputable source, so that I can verify this to my friend as well?

I googled but I may have used the incorrect keywords, I didn't find anything.

Short Term Capital Gain on Shares (Section 111A of Income Tax Act) - STCG Tax Rate and Calculation

Section 111A of Income Tax Act: Equity stocks invested on a listed recognized stock exchange having a holding period of more than 12 months are considered short term capital gains.

cleartax.in

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[Batman]

Short Term Capital Gain on Shares (Section 111A of Income Tax Act) - STCG Tax Rate and Calculation

Section 111A of Income Tax Act: Equity stocks invested on a listed recognized stock exchange having a holding period of more than 12 months are considered short term capital gains.

cleartax.in

+
=

Thank you for sharing. I'll go through this and ask if I have further questions. Thank you!

 

[CARDBITRAGE]

Edit:
STCG is zero, if your taxable income is <2.5L, and no tax is to be paid. If income >2.5L, it is taxed at 15% of your CGs along with the applicable cess.
LTCG on the other hand gets taxed separately as per the asset class.

LTCG on Equity Mutual Funds, Stocks- 10% ( only for gains above 1L/FY; not taxed otherwise ) + cess
LTCG on Gold, Debt Funds, Miscellaneous Assets, Real Estate- 20% + cess

 

[ak93]

STCG gets added to your taxable income and you will have to pay tax according to your bracket. If it is <5L, no tax is to be paid.
LTCG on the other hand gets taxed separately as per the asset class.

LTCG on Equity Mutual Funds, Stocks- 10% ( only for gains above 1L/FY; not taxed otherwise )
LTCG on Gold, Debt Funds, Miscellaneous Assets, Real Estate- 20%

Small correction on STCG.

If taxable income is <2.5L, no tax has to be paid.

If taxable income is <5L, you get a rebate upto 12,500 which is for the 5% tax from 2.5L to 5L. STCG is taxable at 15%, so you still need to pay tax for the remaining amount.

"For your income of ₹5 lakh comprises of one lakhs of short term capital gains on listed shares of one lakhs and balance is your regular income. You tax liability would be Rs. 22,500, comprised of Rs. 7,500( 5% on 1.50 lakh)+15,000 (15% on 1 lakhs of Short term capital gain). After rebate of 12500/- you will have to pay Rs. 10,000/-"

 

[Riya]

I thought I knew the answer, but a friend says otherwise so I need to ask -

Does STCG/LTCG depend on total income? For example, if the total income is <5L, does that person not pay any tax?

I always thought it was a flat 15%/10%, not matter the other income sources.

Please share a link so that I can verify to my friend as well.

Yes.. your friend is right...
Long term gain is flat 10% above 1Lakh per year per PAN...
Short term gain is added to your total income and then taxed.... No tax if still the total income is less than 5L