How does that work? Let’s take an example.
1. LTCG was introduced in Budget 2018 with a tax of 10% on profits made above Rs.1 lakh on selling of equity shares & mutual funds.
Every long term investor wants to save tax on capital gains, but how?
This thread talks about a simple way "Tax Loss Harvesting"
How does that work? Let’s take an example.
For TLH, sell underperforming stock at capital loss, say of Rs 20000.
Now, u need to pay tax on 25000-20000 = Rs.5000
This helps you to save tax on extra 20000 had you not set off your loss against the gains.
No worries, you sell in this fin. yr, say on 31st March & buy again in next day i.e. next fin. yr on 1st April.
With discount brokers, transaction cost is zero.
•Tenure of investments.
•LT capital losses can be set off against only LT capital gains.
•ST capital losses can be set off against any capital gains.
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