A capital gains tax is a type of tax that is levied on the value of shares transferred by individuals. This tax is different from income tax as it is not applied to the sale of a business asset. However, if you own more than a million shares, you will be subject to this tax if your turnover exceeds Rs. 1 crore or Rs. 2 crore. You can avoid this tax by keeping records of your share transactions and not reporting them.
In general, all stock market transactions are taxable. However, investors who are conservative should check to see if they are chargeable. There are two types of capital losses: short-term and long-term. Short-term capital loss can be set off against Profit in the same Head while long-term capital loss cannot be set off against any head. Nevertheless, you can carry forward your capital loss to the following eight years and offset it against your future income.
The AO does not contest the taxability of the shares for which you have made a profit. You should choose a tax treatment for those shares that you have traded for less than one year. This means that you should maintain your position for subsequent years. It is also important to keep in mind that stock-in-trade taxes are applicable to listed shares, not stock-based trading. You will have to pay 6% of the total turnover regardless of whether you have a short or long-term investment period.
While the taxation on share trading depends on the economic condition of a country, you should be aware that a financial transaction tax (FTT) can increase the cost of share trading. It is a small amount that could potentially hurt the economy. In addition, this tax is not applicable to investors who sell shares for less than Bt1 million a month. The Finance Ministry has assigned the Revenue Department the task of studying the pros and cons of this new measure.
An FTT is a tax on share trading. There are many different types of FTTs, but in general, capital gains are generally taxable at 15% of the value of a listed security. The taxation of equity can be difficult to calculate if the trader does not understand the tax implications of the FTT. The rate of capital gain will also depend on how many shares you own. For example, a taxpayer can claim a deduction of up to one percent of the market cap of the company.
In general, a taxpayer may choose to treat income from shares sold on the stock market as a capital gain if the shares are sold on the same day. It is also possible to elect to use a stock-in-trade tax treatment when selling listed shares. This type of tax treatment is only applicable to shares held for a period of 12 months or more. In other words, it is advantageous to consider the tax implications of share trading before choosing a strategy.