CHAPTER 8 TAXATION
- Capital Gains Tax
- In the case of long-term capital gains arising out of equity shares and equity-oriented mutual funds, the tax is applicable only on capital gains above Rs. 1 lakh.
- The dividends would be taxable in the hands of the recipient at the applicable tax rate.
- Setting off of Capital Gains and Losses under IncomeTaxAct
Capital loss, short term or long term, cannot be set off against any other head of income (e.g. salaries).
Short term capital loss is to be set off against short term capital gain or long term capital gain.
Long term capital loss can only be set off against long term capital gain.
- STT applicability for Investors in Equity oriented Mutual funds
- Equity Linked Savings Schemes (ELSS) are eligible for deduction under Section 80C of the Income TaxAct.
- The TDS applicable for non-resident investors is the lower of the rate specified in the income tax regulations or the tax specified in the DTAAof the country where the investor is resident.