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of <h1>Section 94(8) Targets Tax Avoidance via Bonus Stripping in Securities or Units; Losses Reclassified as Acquisition Costs.</h1> Section 94(8) addresses tax avoidance through bonus stripping transactions involving securities or units. It applies when a person acquires securities within three months before a record date, receives additional securities without payment, and sells the original securities within nine months while retaining the additional ones. In such cases, any loss from the initial securities' sale is disregarded for tax purposes and is instead considered the cost of acquiring the additional securities. The 'record date' is set by entities like companies or mutual funds to determine entitlement to dividends or additional securities. 'Securities' encompass stocks and shares, while 'units' include interests in business trusts and alternative investment funds.
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