Last Updated : Sep 26, 2020 09:45 PM IST | Source: Moneycontrol.com Gains from amendments to the Finance Act, 2018, were eligible for additional taxation, but any trading income for Assessment Year 2020-21 does not need to be disclosed.
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Stock traders will not have to report scrip-wise details of their income while filing their tax returns, the Finance Ministry clarified on September 26. Capital gains made from shares held for less than a year come under business gains and do not need to be disclosed for each scrip.Unless the shares are held for over a year and come under the long-term capital gains (LTCG) arrangement, gains from share trading are not classified any different from normal business income. An addition to the Finance Act, 2018, allowed some gains to be grandfathered in, but that does not apply to any gains made in Assessment Year 2020-21, the Finance Ministry said in a statement.”There is no requirement in the Income Tax (I-T) returns for scrip-wise reporting in case of short-term/business income arising from share transactions,” the statement read.The confusion stemmed from the fact that stocks carried over from before January 31, 2018, under the Act would be eligible under LTCG, and the details of each scrip would be required while filing tax returns. Only those shares, which are eligible for the grandfather clause, or those carried over from before 2018, need to be reported individually.The statement referred to media reports which said that individuals will have to file details of all share sales, including share name, sale and purchase price, while filing their tax returns for AY 2020-21. It clarified that scrip-wise details are only applicable to compute LTCG taxation, which was introduced in the Finance Act, 2018.
First Published on Sep 26, 2020 08:43 pm