At present, a 10% tax is levied on such long-term capital gains. However, the new law won’t be applicable for all the gains up to 31st January 2018. This implies that any person who will sell shares after 1st April, 2018 will have to pay a 10% long-term capital gains tax if he/she gains an amount more than Rs. 1 lakh.
How do I pay tax on shares?
Section 111A states that if you sell shares or mutual funds within one year of purchasing them, all proceeds will be treated as short-term capital gains. Profits made from the sale of STT (Securities Transaction Tax) paid shares listed on recognised stock are taxed at a 15% rate if sold within 1 year of purchase.
What kind of tax do you pay on shares?
Capital gains tax on shares. Capital Gains Tax is paid when you make profits from your shares. Any losses from your shares can be deducted from the profits to reduce the amount of capital gains tax you have to pay. Income tax on dividends. The other type of tax you pay, income tax, is only due if you receive money from stock dividends.
What are the tax implications of a share sale?
Tax implications of a share sale In the event of a share sale, shareholders sell the shares and they (not the company) must account for any tax liabilities. Capital gains tax may be payable by the seller and the rate may be lower than the income tax applied on an asset sale.
When do you pay capital gains tax on shares?
Capital gains tax on shares. Capital Gains Tax is paid when you make profits from your shares. Any losses from your shares can be deducted from the profits to reduce the amount of capital gains tax you have to pay.
How is LTCG from equity share trading taxed?
This LTCG from equity investment is tax exempt. LTCG is exempted if a transaction done through recognized stock exchange and STT (Security Transaction Tax) paid. If stock is not trading on any recognized stock exchange then this LTCG is taxed at 20%.
