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basant
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Quote basant Replybullet Posted: 20/Jul/2010 at 11:09am
Does anyone have an idea as to how stocks that are already in long term on March 31st 2011 will be treated. Will one have to sell and buy them back.
 
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Quote anthro Replybullet Posted: 20/Jul/2010 at 11:16am
Student 55
 
You have not provided data on whether your short term capital gains plus salary is less than Rs.160000 ( if you are a male below 65 years ) - The small correction to my below post is that in case you are below the limit then you need not pay short term capital gains tax.So do not worry if your salary plus short term capital gains tax is less than Rs.160000 . But if it is more then just pay the tax plus penalty and also file your tax return in ITR2
 
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Quote shivkumar Replybullet Posted: 20/Jul/2010 at 11:19am
We should hold our horses till the final bill becomes law. Going by the record of the past two decades, Indian governments tend to favour capital accumulation more than labour.
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Quote anthro Replybullet Posted: 20/Jul/2010 at 11:21am
 
Once the new DTC comes into effect from 1st April 2011 , long term capital gains would be taxed with allowance for deduction which is still unknown.So it makes sense to sell and buy back some time much before the 31st March 2011 date so that
 
  1. You get 100% tax exemption on realised long term capital gains
  2. Your new purchase ( of same security ) gets accounted at a higher cost.So when you sell that say 5 years from now under new DTC your profit would be accordingly less ( as your cost is higher ) .

But this makes sense only for investors who are sitting on huge long term capital gains as you need to account for brokerage,price risk ( between your sell and buy dates etc ).

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Quote basant Replybullet Posted: 21/Jul/2010 at 12:19pm
With some shares you can do a cash future arbitrage with the others you can sell from one account and buy into another and then reverse the trade the following day!



Edited by basant - 21/Jul/2010 at 12:20pm
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Quote student_55 Replybullet Posted: 21/Jul/2010 at 7:42pm
Originally posted by anthropod

Student 55
 
You have not provided data on whether your short term capital gains plus salary is less than Rs.160000 ( if you are a male below 65 years ) - The small correction to my below post is that in case you are below the limit then you need not pay short term capital gains tax.So do not worry if your salary plus short term capital gains tax is less than Rs.160000 . But if it is more then just pay the tax plus penalty and also file your tax return in ITR2
 
Anthro 


A big thumbs up for you Anthropod. You have been of great help.

I worked for slightly over 3 months from April 2009 to mid July 2009. I am unable to locate my form 16 but I am sure that my salary for these 3 months was less than 1 lakh total (even including HRA etc)


My Short Term Capital Gains for the year are just about Rs. 40,000. So the salary plus the short term capital gains would be in any case less Rs. 1,65,000. So, I do not need to pay any tax at all for year 2009-2010 and just file the return in ITR Form 2?

It is a reason to party if that is true, as I was thinking I will need to pay tax, albeit a few thousand Rupees.


Now, let us say, there is an individual whose salary (excluding HRA etc) is 1,00,000 and the Short Term Capital Gains for the year stand at Rs. 1,00,000. How will the tax be calculated in this case?
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Quote anthro Replybullet Posted: 21/Jul/2010 at 9:38pm
Student 55 ,
 
As your total income <  Rs.160000 you need not pay tax nor even is there a requirement to file the "nil" income return though its advisable to file nil return from a continuity perspective.

Your second question is interesting : If your total income exeeds the limit marginally and you arrive at the 10% slab , you pay short term capital gains still at 15% ( and not 10% ) - There is a complicated way to reduce this 5% but will not recommend . For academic purpose you may see below discussion.
 
 
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Quote student_55 Replybullet Posted: 22/Jul/2010 at 12:38pm
Originally posted by anthropod

Student 55 ,
 
As your total income <  Rs.160000 you need not pay tax nor even is there a requirement to file the "nil" income return though its advisable to file nil return from a continuity perspective.

Your second question is interesting : If your total income exeeds the limit marginally and you arrive at the 10% slab , you pay short term capital gains still at 15% ( and not 10% ) - There is a complicated way to reduce this 5% but will not recommend . For academic purpose you may see below discussion.
 
 



I am happy to know that I do not have to pay any tax this year. Thanks a lot Anthropod.

I have asked my last employer to send me a copy of Form 16. Once I get it, I will file the return asap.

Thanks a lot.

PS: I have not started filling up the Form2, but on having an overlook I noticed a column for Dividends. Are these the annual dividends that I received from stocks? If yes, how do I track these, as they are nowhere mentioned in the profit-loss sheet sent to me by my broker for the financial year.


Edited by student_55 - 22/Jul/2010 at 12:46pm
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