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Long-term capital gains arising from sale of listed securities

 

Section 112A provides that capital gains arising from transfer of a long term capital asset Being an equity share in a company or a unit of an equity oriented fund or a unit of a Business trust shall be taxed at the rate of 10 per cent of such capital gains exceeding Rs.1,00,000.

This concessional rate of 10 per cent will be applicable if:

1. In a case of an equity share in a company, securities transaction tax has been paid on Both acquisition and transfer of such capital asset; and
2. In a case a unit of an equity oriented fund or a unit of a business trust, STT has been Paid on transfer of such capital asset.

The cost of acquisitions of a listed equity share acquired by the taxpayer before February 1, 2018, shall be deemed to be the higher of following:

1. The actual cost of acquisition of such asset; or
2. Lower of following:
   1. Fair market value of such shares as on January 31, 2018; or
   2. Actual sales consideration accruing on its transfer.

The Fair market value of listed equity share shall mean its highest price quoted on the Stock exchange as on January 31, 2018. However, if there is no trading in such shares on January 31, 2018, the highest price of such share on a date immediately preceding January 31, 2018 on which trading happens in that share shall be deemed as its fair Market value.