Finance Buddy

If you've made money in the recent stock market rally, understanding how your stock market income is taxed is crucial. Here's an explainer on the income tax rules for stock market investors: 1. Types of income:  Income from the sale and purchase of shares falls under either business income or capital gain . 2. Holding period matters:  Tax and investment experts highlight that the holding period determines the nature of income. If stocks are held for more than 12 months, it falls under long-term capital gain; if the holding period is less than or equal to 12 months, it is considered short-term capital gain. 3. Business income or capital gain:  Sujit Bangar from  Taxbuddy.com  emphasizes that if stocks are sold under line delivery, it's non-speculative and can be taxed as normal business income or capital gain. Trading in futures and options is also considered non-speculative business income. 4. Taxation rates:  Business income is taxed at regular slab rate...

Income tax calculator:   An income made on sale and purchase of shares fall under the business income or capital gain head. So, those who made money in recent stock market rally need to know how their income from stock market will be taxed. According to tax and investment experts, income from stock market is calculated on the basis of holding period. If the investor has hold the stock for more than 12 months, then the income will fall under long term capital gain category. However, if the holding period is less than or equal to 12 months, then the stock market income would be called short term capital gain Income tax rules for stock market investors Speaking on how income tax applies on stock market gains, Suji t Bangar , Founder at Taxbuddy.com said, "Income earned from stock market is taxed either as business income or capital gain. If stocks are sold with under line delivery, it’s non speculative. This type of transaction can be taxed as normal business income or capital gai...

  Ashok Jamwadikar invested Rs 45,000 in SBI Infrastructure Fund – Regular Plan – Growth on July 6, 2007. He purchased 4500 units of the fund at Rs 10 each. The NAV of the fund has increased to Rs 35.3075 as of 30 September 2023 and the total value of Ashok’s investment has reached Rs 158,884. In an email sent to FE Money, Ashok asked whether he would be liable to pay LTCG tax if he redeems his investment. Further, he wanted to know how much LTCG tax he would have to pay and whether he could redeem the units partly or not. In India, LTCG tax is applicable to investments in equity-oriented mutual funds, including the one mentioned in the above query. However, the tax implications depend on the holding period and the amount of gains. As the holding period in the above case is more than 1 year, it will be considered as LTCG. The important fact here is the inclusion of “Grandfathering Provisions” at the time of calculating Tax. In the context of equity-oriented mutual...

  Today (Sept 15) is the last date to pay the second instalment of advance tax for the assessment year 2024-25. "If one misses on this instalment, interest at the rate of 1 per cent per month starts to be calculated on unpaid tax liability of estimated income of financial year 2023-24,” said Sujit Bangar , Founder of Taxbuddy.com Source Link:  https://www.businesstoday.in/visualstories/news/advance-tax-2nd-instalment-payment-deadline-today-yatra-online-ipo-to-open-in-top-news-on-september-15-share-markets-bank-nifty-outlook-upsc-civil-services-mains-2023-exam-to-begin-63078-15-09-2023 Website Link: https://www.taxbuddy.com/