The Capital gain tax rate from the selling of securities, equity mutual funds, and debt mutual funds is calculated by three factors: What is the amount of time the shares have been held? Whether the instrument is a portfolio, an equity mutual fund, or a mutual debt fundIs there any STT (Securities Transaction Tax) on the shares’ business?

 

Long Term

Short Term

STT requited the sale of shares listed on recognised stock exchanges and mutual funds

10%; minimum holding period of 1 year

At marginal tax rate (5% to 30%) plus 3% cess plus surcharge (if applicable)

Assets other than STT paid marketing of shares listed on identified stock replacements & mutual funds

20%; minimum holding period of 3 years

At marginal tax rate (5% to 30%) plus 3% cess plus surcharge (if applicable)

Debt mutual funds

20% with indexation or 10% without indexation; whichever is lower; minimum holding period of 3 years

At marginal tax rate (5% to 30%) plus 3% cess plus surcharge (if applicable)

On the sale of  share and mutual funds of the capital gain tax rate  

capital gain tax

On the selling of stock, there is a short-term capital gain.

Any gains resulting from the selling of shares and mutual funds within one year of their purchase are deemed short term capital gains under section 111A. Profits received from the selling of STT (Securities Transaction Tax) paying shares that are exchanged on a registered stock exchange are taxed at a rate of 15%

On the sale of equity, long term capital gain 

When you sell the mutual funds’ shares under section10 (38) within three years, any type of gain in the money’s hike when you sell is considered Long term Capital gain.No tax will be levied on the long term capital gain the paid share recorded on the identified stock exchange are according to the Income Tax Act are tax exempted from the sale of Security Transaction Tax.Long-term capital gains on non-STT paying shares, bonds, debentures, and other listed assets, on the other hand, would be taxed at a rate of 10%.    

The STT liquidated shares listed on the acknowledged mutual fund and stock exchange the capital gain tax rate on assets’ sale. 

Short-term capital gain on the selling of asset other than STT paid shares listed on the stock exchange and mutual fund: Any profits resulting from the sale of any asset other than STT paid shares and mutual funds within one year of purchase will be taxed at the marginal income tax slabs applicable to individuals and HUFs.

Long-term capital gains on the selling of assets other than STT paid shares listed on the stock exchange and mutual funds: Any gains resulting from the sale of any asset other than STT paid shares and mutual funds within three years of the date of purchase will be taxed at a rate of 20%, plus the applicable surcharge and cess.

On the sale of debt, mutual 

Any profit gained from the selling of debt mutual funds is considered a capital gain. However, you must measure the minimum holding period to decide if the gains are short-term capital gains or long-term capital gains. The minimum holding period is measured from the time mutual funds are bought to the time they are sold.

If you sell debt mutual funds within three years of buying them, the profit you make is called a short-term capital gain. The resulting gain will be called long term capital gain if the sale happens after three years from the date of purchase. According to income tax law, the treatment of short-term and long-term capital gains is different.

FAQs 

✅What is the formula for estimating capital gains tax on stocks?

The capital gains tax is based on the profit gained from selling the shares after considering the amount of time they were owned to decide if it was a long or short term capital gain.

✅How do I stop paying capital gains tax on my portfolio investments?

Make sure you keep them for at least a year to avoid paying capital gains tax. Only when a financial year’s profit from equities reaches $1 lakh is long-term capital gain taxed.

✅Is there any capital tax on shares?

Yes, there is capital taxes on shares.

✅Is there an exception for long-term capital gains on stocks?

Long-term capital on shares is only excluded up to Rs. 1 lakh in a financial year.

Contact 9878981166 or visit Dialabank’s website for more details.

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