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ud83dudcb0ud83dudcc8 Understanding Short-Term Capital Gains! Short-term capital gains occur when you sell an asset held for less than a year, and they are taxed at your ordinary income tax rate. Stay informed to make smarter investment decisions! ud83dudca1u2728
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Let’s learn SHORT-TERM CAPITAL GAINS WHAT’S THAT? Divadhvik_official www.divadhvik.com
Short-term capital gains arise when an asset, such as stocks, bonds, or real estate, is sold within a short period—specifically within 12 months from the date of acquisition. These gains are calculated by subtracting the purchase price (cost of acquisition) from the selling price. Divadhvik_official www.divadhvik.com
TAXATIONS 1. Income Classification: Short-term capital gains are treated as ordinary income but are often subject to a specific tax rate. 2. Tax Rate: For equities and equity-oriented mutual funds, the short-term capital gains tax rate is typically 15%. For other assets, gains are taxed as per the individual's income tax slab rate. 3. STT Applicability: The 15% rate applies to gains from transactions on which Securities Transaction Tax (STT) has been paid. Divadhvik_official www.divadhvik.com
KEY CONSIDERATIONS Transaction Costs: Brokerage fees and related expenses are deductible. Documentation: Maintain records of all transactions and expenses. Filing Requirements: Report gains under 'Capital Gains' in your tax return. Strategic Planning: Time asset sales to manage tax liabilities and offset gains with losses. Divadhvik_official www.divadhvik.com
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