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