If my business income is 11.5L can i book 1.25L LTCG and still be tax free
this article saying otherwise hence asking
This article is saying the opposite(I think):
The question seems to be whether the “total income” referred to in section 87(A) includes or excludes special income like that which is taxed under 112 and 111. If so, by what section? @Quicko
Hello @Nandha207
If your business income taxable at normal slab rates is â‚ą11.5 lakhs and you have Long-Term Capital Gains (LTCG) of â‚ą1.25 lakhs, there will be no tax liability on the LTCG. This is because income taxable at special rates is computed independently and does not affect the rebate calculation applicable to normal income.
Further, LTCG up to â‚ą1.25 lakhs is exempt under section 112A. Accordingly, no capital gains tax would be payable on such gains, and both income streams are assessed separately as per the applicable provisions of the Act.
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Hello @BB789
The “total income” referred to under section 87A of the Act excludes income that is taxable at special rates, such as capital gains covered under sections 112A, 112, 111A, etc. This treatment is specifically provided in the respective provisions governing the taxation of different categories of capital gains.
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@Quicko Thanks. Which provisions are you referring to? I can only find 112A(6)
(6) Where the total income of an assessee includes any long-term capital gains referred to in sub-section (1), the rebate under section 87A shall be allowed from the income-tax on the total income as reduced by tax payable on such capital gains.
What about 111, 111A and 112?
Hello @BB789
The rebate under section 87A is not available against the special rate income has been mentioned in Section 112A and second of proviso of section 87A.
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Thanks.
If my normal ie slab rate income is Rs 10 lakh during financial year 25 26 and stcg from shares is 5 lakh will I get 87a rebate on normal income of 10 lakh?
Yes you will get it. You can check it by yourself on income tax calculator on it portal
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