P Mehta & Jain


(As Proposed in Finance Bill, 2018)

Let’s understand the tax ability of listed equity shares with a flow chart (assuming STT has been paid on purchase & sale of shares in a recognized stock exchange)

COA = Cost of Acquisition

FMV = Fair Market Value (Highest price on 31st Jan, 2018, otherwise immediately preceding date Traded price)

LTCG = Long term capital Gain

STCG = Short term capital Gain

LES = Listed Equity Shares


Then COA will be Actual Sales price or Actual Purchase price whichever is higher.

Long term Capital gain will be Actual Sales price Less (‐) Cost of acquisition as per above flow chart. Tax @10% in excess of Rs. 1 Lakh in addition to Security Transaction Tax (STT) will be charge on LTCG. However all accrued gains till 31st January, 2018 are exempt practically as per above flow chart.

(The author can be reached at capmjco@gmail.com)

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Qualification: CA in Practice
Company: Owner - P Mehta & Jain
Location: Ahmedabad, Gujarat, IN
Member Since: 14 Jul 2017 | Total Posts: 4
Chartered Accountant, Registered Valuer, DISA (ICAI) View Full Profile

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