A basic tax query related to stocks

Suppose I buy 100 shares of Asian Paints on 28th October 2014. After about one month, say on 28th November 2014, I buy 100 more.

Fast forward one year - on 29th October 2015, I sell 150 shares at a good profit. Now according to the existing taxation laws, would I be charged tax on all 150 shares or only 50 shares as I think the first 100 shares which I bought will be taxed as long-term capital gains which is zero for equity at present.

I’m in doubt, help please.

My understanding is also same as you.

You can show proof of contract note for those 100 shares bought on 28th Oct 2014 and sold on 29th Oct 2015, and get long term capital gain exempted.

For 50 shares which does not span for 1 year, you need to pay tax. Whether you sell as 150 shares or 125 shares or 100+50 shares or 75+75, it does not matter. Only the dates are important.

Also in Demat Account, FIFO (First In First Out) is followed. So the 150 shares you sell, 100 will be the shares you bought earlier on 28th Oct 2014.


Yep. both of you are correct.