Under the provisions of section 111A tax on short-term capital gains, in the case of equity shares in a company or units of an equity oriented fund on which Securities Transaction Tax (STT) has been paid, is levied at the rate of 15%. This rate was increased from 10% to 15% vide Finance Act, 2008 with effect from 1.4.2009. However, in the proviso to this section while providing relief, the rate of short-term capital gains tax is still referred to as 10% which needs to be corrected to 15%.

It is accordingly proposed to amend the provisions of proviso to section 111A of the Income-tax Act.

This amendment will take effect retrospectively from the 1st day of April, 2009 and will accordingly apply to assessment year 2009-10 and subsequent assessment years.

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Tags : Budget (1957) Capital Gain (410) Short Term Capital Gain (66)

11 responses to “Rate of tax for short term capital gain under section 111A – Correction in proviso to section 111A”

  1. SGSG says:

    Can STT for both purchase and sale of shared be included in the cost of acquisition for computing short term capital gains?

  2. U KISHORE says:

    i have a salary income . I also received 40,000 from stocks (short term capital gain i.e all profits made within a year) after giving all brokerage and STT taxes. Could you please let me know what extra tax I need to pay wrt stocks. ITR1 or ITR2?

  3. jyoti biswal says:

    I have a salary income 1500000 annually . I also received 400000 from stocks (short term capital gain i.e all profits made within a year) after giving all brokerage and STT taxes. Could you please let me know what extra tax I need to pay wrt stocks.

  4. Ravish Kala says:

    Dear Sir,
    If my taxable income from salary is Rs 4 Lac and I have a share income (within 12 months) from D’Mart ipo of amount 14000.00 and paid STT on it. My question is that my tax has been deducted on salary part do I have to pay tax on share income also, if yes, please also confirm the rate applicable.

    • Ashwini Nath says:

      Dividend received from indian companies is exempt u/s 10(34)….so if ur company is an indian company u need nt pay any tax as u hav already paid STT on it.

  5. KTHYAGARAJAN51 says:

    IF THE BONUS SHARES HELD IN A LISTED COMPANY SAY IN THE CASE OF itc RECENTLY BONUS SHARE WAS GIVEN. IF SUCH SHARE IS SOLD AFTER ONE YEAR FROM THE DATE OF ALLOTMENT IT WOULD NOT BE SUBJECT TAX IN THE FORM OF SHORT TERM CAPITAL GAIN. I’AM CORRECT. PLEASE CLARIFY. KIND REGARDS KTHYAGARAJAN email id kthyagarajan51@gmail.com

    • Sujatha Anand says:

      No. If the bonus shares are sold within 36 months from the date of their acquisition, there would be a short term capital gain which is to be computed by taking the cost of acquisition of bonus shares as nil. If the shares are sold after 36 months, it would constitute a long term capital gains which is exempt u/s 10(38) if the shares are listed, and sold through the stock exchange.
      P.S.- the short term capital gain would be calculated at 15%

      • Sujatha Anand says:

        I’m sorry, it’s 12 months* and the short term capital gains would be TAXABLE @ 15% u/s 111A and not calculated.

  6. SHANKAR KONWAR says:

    Sir, my Total Income is Rs.234489 in which short term capital gain on shares is Rs. 5732. Then what is the Taxable Amount for Individual man below 65years for F.Y.2014-15?

  7. RAVISH KUMAR JAIN says:

    How to show the short term capital gains/loss shown in Income Tax return for F&O and commodities. Whether it is to be shown in Income return Capital Gain section 2 (1).

  8. shweta says:

    sir, what is the rate of short term capital gain on land? If my Total Income is Rs.390480 in which short term capital gain on land is Rs.213960. Then what is the Taxable Amount for Individual man below 65years for F.Y.2011-12?

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