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calculate tax on share trading
I am a
salaried employee of a PSU. I earn short-term capital gains from
buying/ selling shares. Can I show deductions for DP charges for
demat a/c, computer upgradation, annual maintenance, Internet etc
charges when calculating tax? Can I deduct STT paid for tax
calculation?
On the facts stated by you, you can claim the various deductions
mentioned by you from the short-term capital gains so derived by
you. However, please note that STT will not be deducted as per the
provisions of the Income-tax law.
 I
have difficulty filling the capital gain for shares. Please
provide me with the rules and regulations and/or schedules of the
IT Act.
Very simple indeed.
For calculating income-tax on short-term capital gain of listed
securities, you are governed by section 111A of the
Income-tax Act, 1961. This section provides for taxing short-term
capital gains of listed securities @ 10% only. Please arrive at
the net figure of capital gains by deducting the losses, if any.
In this
financial year, how is income tax levied on profits made on
shares? If there is some loss on share transactions, how can it be
offset with profits? What if one makes a loss on buying price of
shares, but bonus
shares are given?
If you derive
short-term loss, the same can be adjusted with short-term capital
gain. The cost of the bonus shares will be treated as Nil while
calculating the capital gains. Hence, please arrive at the net
figure to claim the deduction.
I am
involved in
share
trading and also some
intraday trading. If I have a gain of Rs 10,000 and Rs 2,000 loss
in others, what will be my gain? Will it will be Rs 8,000 can loss
not be calculated, and should be reflected separately in CYLA? 2)
Should intraday trading be calculated with other trading, or
separately?
For calculating
short-term capital gain, you have to calculate the net amount of
such gain. Thus, loss from the gross amount of capital gain will
be deducted the short-term loss from the gross of capital gain.
The intraday trading income has to be separately calculated and
has to be adjusted with intraday trading loss and thus the net
income arrived at.
My wife
invests in shares (though not day trading or F&O). She also
receives a rent for a house. Her income from short-term capital
gain is Rs 35,000 and Rs 61,000 from house rent. Is there a tax
liability, since her income is less than Rs 1,35,000? Which ITR
return form (if any) needs to be filled?
Generally speaking
short-term capital gains are chargeable @ 10% while other income
is chargeable @ slab rates. In your case the total income of your
wife inclusive of short-term capital gain income is below the
exemption limit, hence, the entire short-term capital gain will be
fully exempted as per section 111A of the Income-tax Act, 1961.
Your wife can use Return Form No 2 for filing her return.
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Tax benefits on a housing loan |
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Repaying a housing loan? There is a
lot to look forward to by way of deductions and rebate.
Interest paid on capital
borrowed for the acquisition or construction of
property is entitled to a deduction. Initially,
the maximum amount eligible for deduction was Rs
15,000 (1997) and then got doubled to Rs 30,000.
Later, the amount got further enhanced to Rs
75,000 and is now Rs 1 lakh.
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So as the rules go, if you borrow
money to acquire or construct property on or after April
1, 1999, then you can get an income tax exemption on the
interest paid on a housing loan up to a limit of Rs 1 lakh.
You also get a
20% rebate on repayment of principal of the
housing loan. While this was earlier subject to a
maximum of Rs 10,000, it is now Rs 20,000.
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You should be residing in the
home for which the loan is taken. If you are
residing in a city but buying property in your
home town to prepare for retirement, this will not
be applicable. The property has to be acquired or
constructed before April 1, 2003. The money should
have been borrowed to construct or acquire
property on or after April 1, 1999. If it was
prior to this date, the deduction is only valid up
to Rs 30,000.
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| Points to note |
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You may find it more
convenient and cheaper to finance the property out
of your own resources. But do remember, you would
be losing the tax shelter on account of the
deduction available as well as the tax rebate. You
can claim a rebate for housing loan only on
producing the interest certificate from the
lending institution. Taking a loan from a family
member or a friend may get a you a cheaper rate of
interest, or no interest at all, but will not
qualify for such deductions. Only loans taken and
interest paid thereon, to specified financial
institutions which offer housing loans, qualify
for deduction under the Income Tax Act, 1961.
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If
the loan is jointly taken by you and your spouse,
you both are entitled to tax benefits. Since both
will be claiming the deductions and rebate, you
will have to approach the financial institution
and ask for a certificate. This certificate will
state how much of the loan is your responsibility
and how much you are contributing towards the
repayment. Your tax deduction and rebate can be
calculated based on this
amount.
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