Capital Gain / Loss:
The difference between sale price and purchase
price of a capital asset / investment is known as capital gain or loss. In case
of financial assets if the holding period is less than 1 year, the gain is treated
as short term capital gain / loss, otherwise it is treated as long term capital
gain / loss. In case of property, the respective periods are less than 3 and more
than 3 years.
Taxation for short term capital gain:
The gain is clubbed with your annual income and
you pay tax on the entire income.
Taxation for long term capital gain: You have two options
of calculating the tax
@ 10% without indexation (plus surcharge of 10%)
@ 20% with indexation (plus surcharge of 10%)
You have to pay the lower of the two values as calculated
above. Our tool calculates the lower of two values