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Short Term & Long Term Capital Gains -
How Charged to Tax


Tax will be calculated as follows ---

Gross Total Income [excluding income given in columns (2) and (3)]

Long-Term Capital Gains taxable under section 112

Short-Term Capital Gain taxable under section 111A




Step A1 – Find out Gross Total Income from all sources excluding income given in Step B1 and Step C1.

Step B1 – Find out Long-term capital gain

Step C1 – Find out Short-Term Capital Gain taxable under Sec. 111A

Step A2 : Deduct, deduction permissible under sec. 80C to 80U ( A2 cannot exceed A1)

Step B2 : Find out income tax on Long-Term Capital Gain at the rate specified by Sec. 112

Step C2 : Find out Income tax on Short-Term Capital Gain at the Rate specified by Sec. 111A

Step A3 : The balancing amount is “other net income”



Step A4 : Find out income tax on “ other net income”.



Step D – Add the tax computed at Steps A4 , B2 and C2 . it is income tax on net income ( income tax on A3+B1+C1)

Step EAdd surcharge on income tax computed under Step D.

Step F -  Find out D + E

Step GAdd education cess at the rate of 2% of Step F.

Step HAdd secondary and higher education cess at the rate of 1% of Step F.

Step I -  Tax liability is equal to F + G + H

Tax On Long-Term Capital Gains (LTCG)
Tax On Short-Term Capital Gains (STCG)
Exemption[ Section-54] For Capital Gains Arising On Transfer Of Residential House Property
EXEMPTION [Section-54B] To Capital Gains On Transfer Of Agricultural Land
Capital Gain Basis of Charge
Capital Gain- Rate of Taxes
Long & Short Term Capital Gain Tax
Exemption under Capital Gains
Capital Gains – How Computed
Short-Term / Long-Term Capital Gains-How Charged to Tax
Chart Showing the Computation of “Capital Gain”
Check List for Assessment- Capital Gains
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