Tax on long-term capital gains in certain cases - (New) Section 198 / (Old) Section 112A

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.... • Units of a business trust. • Securities Transaction Tax (STT) requirements are satisfied: • For equity shares: STT must generally have been paid both on acquisition and transfer. • For units of equity-oriented funds or business trusts: STT must have been paid on transfer. Method of Computation of Tax on Specified Long-Term Capital Gains [ Section 198(2) ] Tax liability consists of two components: (a) Tax on Long-Term Capital Gains • Long-term capital gains exceeding Rs.1,25,000 are taxed at 12.5%. (b) Tax on Remaining Income • The balance income (excluding such LTCG) is taxed according to the normal provisions applicable to the assessee. Adjustment ....

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....on 198. Step 3: Rebate under Section 156 is allowed only against the balance tax. Definition and Qualification Criteria of Equity-Oriented Fund [ Section 198(8) ] What constitutes an equity-oriented fund.  "Equity oriented fund" means a fund set up • under a scheme of a mutual fund specified in Schedule VII (Table: Sl. No. 20 or 21) or • under a scheme of an insurance company comprising unit linked insurance policies to which exemption in Schedule II (Table: Sl. No. 2) does not apply AND • Fund of Fund Structure A fund qualifies if: • At least 90% of its proceeds are invested in another fund; and • The other fund inve....

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....of the capital asset. • FMV determination under Section 90(8) • Clause (i): Listed share as on 31 January 2018 • FMV = Highest quoted price on the recognized stock exchange on 31 January 2018. • Clause (ii): No trading as on 31 January 2018 • FMV = Highest price on the immediately preceding trading day. • Clause (iii): Unlisted unit • FMV = Net Asset Value (NAV) as on 31 January 2018. • Clause (iv): Certain unlisted shares connected with later listing / IPO situations • Clause (iv)(A) • Share: • unlisted on 31 January 2018, • listed on date of transfer. • Clause (iv)(B) ....

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....equity oriented funds and units of business trust. • Conditions for availing the benefit of he concessional rate are -  • (a) In case of equity share in a company, STT has been paid on acquisition and transfer of such capital assets. • (b) In case of unit of an equity oriented fund or unit of business trust, STT has been paid on transfer of such capital assets. • Accordingly, the central government has, vide notification no. 60/2018, dated 01.10.2018 notified that the condition of chargeability of STT shall not apply to the acquisition equity of share entered into • Before 1st October 2004 or • on or after 1st October 2004 which are not chargeable to STT, oth....

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....ly, 2024; and  • (b) on long-term capital gains, at the rate of 12.5% for any transfer which takes place on or after the 23rd day of July, 2024:  • the limit of Rs. 1,25,000/- shall apply on aggregate of the long-term capital gains under above clauses (a) and (b). • Upto 22/07/2024 • Income-tax calculated on such long-term capital gains exceeding Rs.1,00,000/- • long-term capital gain tax @10% shall be levied. NOTE:- • Benefit of indexation • In case of NRI, benefit of indexation and benefit of calculation of capital gain in foreign currency will not be allowed in cases where section 112A is applicable. • In case of Resi....