NISM Certifications · NISM-Series-V-A: Mutual Fund Distributors · Taxation
Mr. Rao holds equity-oriented fund units with a short-term capital loss. Which statement on set-off is correct?
A short-term capital loss can be set off against both short-term and long-term capital gains in the same year. It cannot be set off against salary income, and any unabsorbed loss may be carried forward for eight assessment years.
- AIt can be set off only against short-term capital gains
- BIt can be set off against both short-term and long-term capital gainsCorrect
- CIt can be set off against salary income
- DIt can be set off against only long-term capital gains
Explanation
A short-term capital loss may be set off against both short-term and long-term capital gains in the same year. Unabsorbed loss can be carried forward for 8 years. It cannot be set off against salary income.
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