Tax on short term capital gain

There are two type of capital gain

Long term Capital gain

Short Term Capital gain ( Section 111A)

There the total income of an assessee includes any income chargeable under the head capital gain arising from the transfer of a short term capital gain asset.

(i) an equity  share in a company or

(ii) a unit of an equity oriented fund or

(iii) a unit of a business trust

and

1. the transaction of sale of such equity share or unit is entered into on or after 1.10.2004
2. such transaction is chargeable to securities  tax

the tax  payable by the assessee on the total income shall be the aggregate of

1 the amount of income tax calculated on such short term capital gain at the rate of 15% and

2. the amount of income -tax  payable on the balance amount of the total income as if such balance amount were the total income of the assessee.

In case of an individual or a Hindu undivided family being a resident where the total income as reduced by such  short-term capital gains is below the maximum amount which is not chargeable to income tax.  then such short term capital gains shall be reduced by the amount by which the total income as so reduced falls short of the maximum amount  which is  not chargeable to income tax and the tax on the balance of such short term capital gains shall be computed at the rate of 15%.

Long Term Capital Gain Tax