Taxability of income arising from shares and other listed securities

  • If an individual derives any income from the transfer of a short term (held for less than 12 months) assets being an equity share or unit of equity oriented fund, the it shall be chargeable to tax at a flat rate of 15% u/s 111A of the Act, provided securities transaction tax is paid at the time of transfer of the share.

If the total income of the resident individual excluding such short term capital gain is below the maximum exemption limit, then such capital gain is reduced by the amount by which the total income falls short of the maximum exemption limit.

  • If the income from transfer of long term (held for more than 12 months) equity shares & unit of an equity oriented fund then it shall be exempt from the tax u/s 10(38) of the Act, provided such transaction is chargeable to the securities transaction tax.
  • Any income received by way dividend from equity shares is exempt from tax u/s 10(34) of the Act.
  • Any income received by way of interest/ dividend from specified Mutual fund or from units of administrator of specified undertaking or units of specified company is exempt from tax u/s 10(35) of the Act.

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