LTCG on Shares with indexation

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  1. Karunaks

    Karunaks New Member

    Regarding LTCG on shares and mutual funds, what are the benefits of indexation on purchase value? I assume we shall take the higher value of either index or non-index cost for tax filing.
    Net selling value = 14410
    Net purchase value = 6500
    Exempted income = 14410 - 6500 = 7910
    (If Purchase index cost = 7455.50, exempted income would be Rs 6955)
    In this case, i shall take my LTCG Rs 7910 for tax filing instead of considering index value. Please correct me, if i am wrong. Thanks.
     
  2. Ragini

    Ragini New Member

    As in this case you need not to do indexation....you can simply take LTCG Rs 7910 as exempt income.
     
  3. gaurav_kumar

    gaurav_kumar Well-Known Member

    LTCG on sale of shares is exempt if the shares were held for more than 12 months and if at the time of sale, STT has also been paid on the same.
     
  4. king999maker

    king999maker Active Member

  5. Karunaks

    Karunaks New Member

    Thanks a lot. In my above case, STT was paid and shares held for more than 12 months. My question was, what is the benefit of indexation on purchase cost. When would we need indexation?
     
  6. king999maker

    king999maker Active Member

    in that case ur total capital gain is exempted from tax , then why the question of indexation?
    we need indexation when stt is not paid or those shares are unlisted, or if the capital gain is a taxable capital gain
     
  7. Karunaks

    Karunaks New Member

    Thanks.
     
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