Skip to content

NISM Certifications · NISM-Series-X-B: Investment Adviser (Level 2) · Taxation of Equity Products

Meera, a resident individual, sold listed equity shares (STT paid) on 10 January 2025 for Rs 4,50,000. She bought them on 5 March 2023 for Rs 3,00,000. She has no other capital gains in FY 2024-25. Assume LTCG on listed equity is taxed at 12.5% above an exemption of Rs 1,25,000, ignoring surcharge and cess. What is the tax?

The tax is Rs 3,125. The long-term gain is Rs 1,50,000; after the Rs 1,25,000 exemption, Rs 25,000 is taxable at 12.5%, giving Rs 3,125. Taxing the whole gain would wrongly give Rs 18,750.

  1. ARs 18,750
  2. BRs 3,125Correct
  3. CRs 40,625
  4. DRs 56,250

Explanation

Gain = 4,50,000 - 3,00,000 = 1,50,000, long-term as held over 12 months. Taxable = 1,50,000 - 1,25,000 = 25,000. Tax = 12.5% x 25,000 = Rs 3,125. Rs 18,750 taxes the full gain without the exemption.

Did you get it right without looking?

One question tells you little. A timed set on Taxation of Equity Products shows your real accuracy, how long you take and where you lose marks.

Practise Taxation of Equity ProductsFree diagnostic mock

More Taxation of Equity Products questions