Taxation on Stock Market Gains in India
Understanding Short-Term Capital Gains Tax (STCG) and Long-Term Capital Gains Tax (LTCG) in India.
Short-Term Capital Gains Tax (STCG)
Short-term capital gains tax applies to profits made from selling stocks held for less than 12 months. The current STCG tax rate in India is 15%.
Long-Term Capital Gains Tax (LTCG)
Long-term capital gains tax applies to profits made from selling stocks held for more than 12 months. The LTCG tax rate in India is 10% for gains up to INR 1 lakh and 20% for gains above INR 1 lakh.
Tax Planning Strategies for Stock Market Investments
To minimize tax liability on stock market gains, consider holding stocks long-term, using tax-advantaged accounts, deducting investment expenses, harvesting capital losses, and reinvesting dividends.
Conclusion
Understanding short-term and long-term capital gains tax in India is crucial for stock market investors. By employing tax planning strategies, investors can mitigate tax liability and maximize investment returns.