'Will Capital Gain Tax be applicable w.e.f. date of purchase or from date of share transfer?'
Anil Rego, CEO, Right Horizons (external link), answers your personal income tax queries.
ASEEM KUMAR VOHRA: I having two types of RBI taxable bonds. For one type which is non-cumulative I get interest regularly after 6 months. Tax is deducted at source and I show it as income in my ITR.
The other is cumulative type which shall get matured in the FY 2023-24. Since no tax has been deducted on interest and nothing was crediting to my bank account during the last 6 years, so no interest income for these bonds was shown by me in my return.
Is it correct from IT point of view?
Next year when the principal and interest shall be credited to my account, the TDS be deducted at source, interest income shall be shown by me in my ITR. Hope my point of view is correct from ITR point of view.
Anil Rego: Yes, this is right from ITR point of view as you are accounting for it on a receipt basis.
Alex Pereira: I had a joint demat account with my wife. I have opened individual demat account and transferred shares purchased by me over the years from the joint account to my individual demat account in April 2022. I sold a couple of shares in April and made profit.
Will Capital Gain Tax be applicable w.e.f. date of purchase or from date of share transfer?
I am retired now and income from pension and investments will be around Rs 2.5 lakh for financial year.
Anil Rego: The capital gain tax will be applicable on date of purchase and not on date of transfer. If your wife has made some contribution towards purchase of the shares, you can consider it as a gift to you.
In this case also, the date is not going to be impacted.
Rakesh Arora: I am a senior citizen and have been filing my IT return since 1984 regularly. I moved to the corporate and retired at the age of 58, with cessation of contribution of PF from 01 Apr 2019. Thereafter, I continued with my company as a consultant, ceasing employment Dec 2020 without any PF contribution and the PF amount continued in the Trust for three years till 31 Mar 2022.
I have finally withdrawn my entire PF amount three years after it became inactive and the agency managing the same on behalf of the Trust have deducted income tax @10% amounting to Rs 105,892 and paid the balance. Please let me know, if:
Do I have to pay the TDS?
If yes, how much income will I have to show when I file my ITR next year?
Anil Rego: EPF withdrawals post-retirement (age of 58 years) is completely tax-free till the date of retirement.
Subsequently, the interest on the EPF amount is taxable as per applicable income tax slab rates. TDS would also be deductible.
You can find more of Mr Rego's answers here.
Note: The questions and answers in this advisory are published to help the individual asking the question as well the large number of readers who read the same.
While we value our readers' requests for privacy and avoid using their actual names along with the question whenever a request is made, we regret that no question will be answered personally on e-mail.
