Capital gain calculation if I hold the same share in 2 different accounts


#1

I have a doubt regarding capital gain calculation.
I have demat accounts with 2 different brokers having 2 demat accounts
I bought a 100 shares of company A 2 years back with first broker.
Then I bought 200 shares of the same company with second broker 6 months back.
If I now sell 100 shares which I am holding at the second broker, what sort of capital gain tax should I pay?
STCG, as the holding with the selling broker is only 6 months old?
LTCG, as the shares bought with first broker is to considered first as per FIFO rule?


#2

@Shaj_Mohamed : based on Pan no it will be FIFO irrespective of broker or demat accounts.


#3

Following. Interesting question!


#4

Thanks for reply
Any reference you have?


#5

There isn’t a set rule on this.

FIFO demat account wise can be done. @TAXIQ.IN ?


#6

Scenario 1: You can choose to classify one demat account for investments and another for holding stock for your share trading business.

In this case, gains/losses from your investment account will be of capital nature and from your business stock account will be in the nature of business profit/loss.

Scenario 2: Alternatively, you can maintain both demat accounts as investment accounts.

a.In this case FIFO applies and you’ve made LTCG on shares bought with the first broker.
b.If you choose to apply FIFO independently in both investment demat accounts and are following it on a consistent basis while accounting for your capital gains then you can defend your treatment in case the IT department scrutinizes your books in any given year.

2.a. would be the fair treatment. however, 2.b. is defendable if consistently followed.

Check with your accountant for details. Cheers.