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Section 112A – Tradewise details of LTCG (Nightmare for Traders)

Under Budget 2018, the Finance Minister, Shri Arun Jaitley, removed the exemption under Section 10(38). He also introduced a new Section 112A with a 10% tax on LTCG in excess of INR 1 lac in the case of a capital asset on which STT is paid. The new Section 112A was applicable from FY 2018-19 (AY 2019-20).

Section 112A Tradewise details of LTCG

Controversy surrounding Section 10(38) & it’s removal

Up to FY 2017-18 (AY 2018-19), Long Term Capital Gain (LTCG) on the sale of a capital asset on which STT (Securities Transaction Tax) is paid was exempt under Section 10(38) of the Income Tax Act. Thus, profit on the sale of listed equity shares, equity-oriented mutual funds, and units of business trust held for more than a year was exempt from income tax.

Since investors already paid STT on listed securities, provisions u/s 10(38) provided relief from double taxation to such investors. However, there was a growing sentiment that the provision encouraged diversion of funds from sectors such as manufacturing & infrastructure into capital markets.

Further, many taxpayers misused the exemption leading to loss of revenue and tax evasion due to abusive practices. Certain taxpayers earned windfall tax-free gains on the sale of penny stocks after inflating its market price by leaking misleading information amongst the investors. Many other taxpayers earned compensation in the form of less salary and more stock options. Such taxpayers paid tax on salary only while they earned tax-free long term capital gains on the sale of shares. Thus, several taxpayers earned bogus long term capital gains without paying tax.

As a result, CBDT removed the exemption under Section 10(38) and made LTCG in excess of INR 1 lac taxable at 10% under Section 112A.

Confusion Galore: Grandfathering Rule Section 112A

Many investors invest in equity markets with an intention to earn tax-free profits in the form of Long Term Capital Gains. For such investors, CBDT introduced the grandfathering rule to ensure that gains up to 31st January 2018 are not taxed. For equity shares and equity mutual funds purchased on or before 31st January 2018 and sold after a year, Cost of Acquisition would be:

  • Fair Market Value as on 31st Jan 2018 or the Actual Selling Price whichever is lower
  • Step 1 or Actual Purchase Price whichever is higher

Long Term Capital Gain = Sales Value – Cost of Acquisition (as per grandfathering rule) – Transfer Expenses

Tax Liability = 10% (LTCG – INR 1 lac)

Long Term Captial Gain Tax on Shares - Equity Shares & Equity Mutual Funds
Learn how to calculate LTCG on sale of equity shares and mutual funds by applying the grandfathering rule
Read More
Long Term Captial Gain Tax on Shares - Equity Shares & Equity Mutual Funds
Learn how to calculate LTCG on sale of equity shares and mutual funds by applying the grandfathering rule
Read More

ITD Utility & Reporting woes of Section 112A

The grandfathering rule and Section 112A has increased complexity and confusion for the investors to Compute Capital Gains and file Income Tax Return. In the ITR utility, the IT department added a new Schedule 112A to calculate LTCG on trade wise basis after applying grandfathering rule.

After much uproar, Schedule 112A, the IT deparment made trade wise reporting optional for FY 2018-19 (AY 2019-20). However, the utilities released by the IT department this year has reignited the discussion.

The IT department issued ITR-2 excel utility for FY 2019-20 (AY 2020-21) on the Income Tax Website on 26th June 2020. It is now mandatory for the taxpayer to enter details of each trade under Schedule 112A. The taxpayer should enter details of each trade with ISIN, share name, quantity, sale price, purchase price, fair market value as on 31st Jan 2018, and transfer expenses to calculate LTCG (Long Term Capital Gain) or LTCL (Long Term Capital Loss).

ITR-1 - Tool 112A

P&L Reports from Brokers (Inadequate)

Investors/traders can download Tax P&L report from their brokers. Brokers like Zerodha provide both FMV as on 31st Jan 2018 and the cost of acquisition as per grandfathering rule in their Tradewise Tax P&L Report. However, the reports of many other brokers do not reflect such details making it extremely challenging for the traders and investors to file their Income Tax Returns.

With such reporting requirements in the ITR and missing information in the broker’s reports, the process of tax filing has become drastically complicated for traders and investors this year. Let us hope that the Income Tax Department comes out with a solution that makes tax filing less tedious for the taxpayers.

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Income Tax Utility updates #TaxSeason2020

Now, while filing for capital gains with ITR 2 and ITR 3, you have to provide the following details of share sold during FY 2019-20:


1. ISIN (aka International Securities Identification Number)
2. Name of the share/unit
3. Number of shares
4. Sales-price per share/unit
5. Cost of Acquisition
6. FMV as on 31/01/2018
7. Expenditure related to transfer


Out of all the above details, ISIN was most difficult to procure as brokerages and investment platforms wouldn’t provide their customers with the same. Yes, it was such a hassle that traders were pulling their hair out.


Now, there might be a chance that the Income Tax Department heard the cries. It came up with a major relief a few days ago – you no longer need to lookup for ISIN. Instead, the trader can use an ‘INNOTAVAILAB’ as ISIN. This can be used in place of the older/original ISIN! This will greatly reduce the stress in trade-wise reporting. Taxpayers now have to worry about one less detail in cases where the data is huge and time is less.

Update on 4th Nov’20- LTCG realized on shares purchased after 31st Jan’18 can be reported at the aggregate level instead of trade level data.

Have any questions ?
The Income Tax Department keeps updating utilities for ease of compliance. Check them out here.
Have any questions ?
The Income Tax Department keeps updating utilities for ease of compliance. Check them out here.

We are Quicko, a team of accountants, developers, and designers on a mission to simplify taxes for all. For any queries or questions comment below.

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vinpint says: (Awaiting Approval)

2020-11-10 03:43:22

Hello everyone.Thanks for such a intuitive blog regarding Schelude 112A.My query rgrd Cost of Acquisition. When we purchase a share from stk mkt the following costs are incurred: 1.Basic price 2.Brokerage 3.STT 4.Central and state GST 5.Stamp Duty 6.Turnover charges 7.Exchange transfer charges. Now while 1,2,3 are charged scriptwise 4,5,6,7 are charged on total turnover(for ex. if you deal in multiple scripts in a day 4,5,6,7 will be charged as consolidated and not scriptwise) . what of these charges are to be considered while calculating cost of acquisition. And also how to calculate 4,5,6,7 scriptwise if they are to be included in cost of acquisition. Please help and oblige Reply

Reply

Vinpin says: (Awaiting Approval)

2020-10-30 05:16:11

Hello everyone.Thanks for such a intuitive blog regarding Schelude 112A.My query rgrd Cost of Acquisition. When we purchase a share from stk mkt the following costs are incurred: 1.Basic price 2.Brokerage 3.STT 4.Central and state GST 5.Stamp Duty 6.Turnover charges 7.Exchange transfer charges. Now while 1,2,3 are charged scriptwise 4,5,6,7 are charged on total turnover(for ex. if you deal in multiple scripts in a day 4,5,6,7 will be charged as consolidated and not scriptwise) . what of these charges are to be considered while calculating cost of acquisition. And also how to calculate 4,5,6,7 scriptwise if they are to be included in cost of acquisition. Please help and oblige Reply

Reply

Vinpin says: (Awaiting Approval)

2020-11-06 18:07:52

Hello everyone.Thanks for such a intuitive blog regarding Schelude 112A.My query rgrd Cost of Acquisition. When we purchase a share from stk mkt the following costs are incurred: 1.Basic price 2.Brokerage 3.STT 4.Central and state GST 5.Stamp Duty 6.Turnover charges 7.Exchange transfer charges. Now while 1,2,3 are charged scriptwise 4,5,6,7 are charged on total turnover(for ex. if you deal in multiple scripts in a day 4,5,6,7 will be charged as consolidated and not scriptwise) . what of these charges are to be considered while calculating cost of acquisition. And also how to calculate 4,5,6,7 scriptwise if they are to be included in cost of acquisition. Please help and oblige Reply

Reply

Vinpin says:

2020-10-28 16:11:07

Hello everyone.Thanks for such a intuitive blog regarding Schelude 112A.My query rgrd Cost of Acquisition. When we purchase a share from stk mkt the following costs are inquired: 1.Basic price 2.Brokerage 3.STT 4.Central and state GST 5.Stamp Duty 6.Turnover charges 7.Exchange transfer charges. Now while 1,2,3 are charged scriptwise 4,5,6,7 are charged on total turnover(for ex. if you deal in multiple scripts in a day 4,5,6,7 will be charged as consolidated and not scriptwise) . what of these charges are to be considered while calculating cost of acquisition. And also how to calculate 4,5,6,7 scriptwise if they are to be included in cost of acquisition. Please help and oblige

Reply

vinpin says: (Awaiting Approval)

2020-10-28 16:14:33

Hello everyone.Thanks for such a intuitive blog regarding Schelude 112A.My query rgrd Cost of Acquisition. When we purchase a share from stk mkt the following costs are incurred: 1.Basic price 2.Brokerage 3.STT 4.Central and state GST 5.Stamp Duty 6.Turnover charges 7.Exchange transfer charges. Now while 1,2,3 are charged scriptwise 4,5,6,7 are charged on total turnover(for ex. if you deal in multiple scripts in a day 4,5,6,7 will be charged as consolidated and not scriptwise) . what of these charges are to be considered while calculating cost of acquisition. And also how to calculate 4,5,6,7 scriptwise if they are to be included in cost of acquisition. Please help and oblige Reply

Reply

Dinesh says:

2020-10-26 17:31:51

Is the exemption of Rs 1 lakh provided under section 112A to be availed before or after adjustment of brought forward long term capital losses on shares ? Also do we have a choice of not using carry forward short term losses of our total income including Short term gains is less than 2.5 lacs ?

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Aakash Lalchandani says:

2020-10-27 19:18:27

Hey Dinesh, The exemption of Rs 1 lac provided under section 112A is to be availed after adjustment of brought forward long term capital losses on shares. Read more about how losses can be carried forward and set off in this article. Hope this helps :)

Reply

Vinay Bhandari says:

2020-10-22 14:42:17

Great blog, most of the doubts already cleared just by reading previous comments. Although I have some query , will be grateful to get a reply. I put forward my query using an example: I invested in Reliance Industries shares in 6 transactions between 2014-2017. I own 200 shares of Reliance as on 31.01.2018 out of which I sold 30shares in FY2019-2020. Do I need to enter all the six transactions thru which I acquired Reliance shares in Schedule 112A. OR I just need to calculate aggregate price from my six transactions and compare with FMV and sale price to get the cost of acquisition and proceed as per the columns of schedule 112A to calculate LTCG for 30 shares

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Aakash Lalchandani says:

2020-10-23 15:58:36

Hey Vinay, You need to report your capital gains for FY 19-20 from the sale of your equity shares. You can report your capital gains without uploading your scrip-wise details by aggregating your purchase and sales price and adding it manually on Quicko under the Capital gains section. Alternatively, you can directly import your trades directly from Zerodha using your Kite Login or even can upload your broker's excel on Quicko by using the import utility function. Learn more about scrip wise reporting for shares eligible for grandfathering.

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Ashish says:

2020-10-20 14:53:53

Hi! Great blog, most of the doubts already cleared just by reading previous comments. One query though, will be grateful to get a reply. I have purchased equity shares and MFs after 31st Jan 18 and sold them after one year in Fy 2019-20 hence grand fathering rule wouldn’t apply but since holding period is more than 1 year, can I get indexation benefit in cost of acquisition? How to declare the same in ITR2?

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Aakash Lalchandani says:

2020-10-21 12:37:37

Hi Ashish, The LTCG tax is applicable at a rate of 10% on gains over and above Rs 1 lakh a year, and there is no benefit of indexation. The benefit of indexation is not available for an asset that is getting taxed as per Section 112A. Thus, the cost of acquisition will be directly reduced from the full value of the consideration to arrive at any gain or loss. Hope this helps :)

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Pankaj says:

2020-10-18 02:25:44

Can you fill ITR2 for a nominal fee?

Reply

Aakash Lalchandani says:

2020-10-19 17:18:57

Hey Pankaj, Check out our expert assisted plans to help you file your ITR. You can also file your ITR-2 by yourself on our Quicko DIY app.

Reply

Anupam says:

2020-10-18 02:18:14

Where has the scrip-wise individual reporting of the redemption of Debt Mutual Funds to be done in ITR2?

Reply

Aakash Lalchandani says:

2020-10-19 17:06:39

Hey Anupam, If it is an equity mutual fund, then schedule 112A will come into the picture. If it is Debt MF then Schedule 112A is not applicable. Hope this helps :)

Reply

Raj says:

2020-10-16 18:53:17

I have downloaded and filled the latest version of Form 2 ie PR3 for AY 2020-21. I have filled Schedule 112A and have LTCG from sale of MF of only Rs 7800/- The same is correctly reflected in Schedule CG, row B4A. However unlike previous year versions of ITR 2, where LTCG after threshold limit of Rs 1.0 lakh was taxed, there is no such provison in the current ITR. I did try to find any such LTCG threshold exemption in Schedule EI too, but to no avail. Filling the relevant data manually in Schedule EI, did not solve the issue as the 10% LTCG tax rate on Rs 7800/- was also auto populated in Schedule SI. I believe that an additional row of LTCG threshold exemption/calculation of the same is missing in Schedule 112A or Schedule CG. Can you please validate the same and help me?

Reply

Vikash says:

2020-10-30 16:06:52

Raj me too getting same problem. If get solved please do let me know

Reply

Aakash Lalchandani says:

2020-10-19 17:03:55

Hey Raj, If it is an equity mutual fund, then schedule 112A will come into the picture. If it is Debt MF then Schedule 112A is not applicable. Fill all the details of trades in 112A and after that, capital gains will get auto-populated. Then Schedule SI will get auto-calculated with an exemption of 1 lakh and calculate 10% on the remaining amount. Make sure all details in Part A general are properly filled. Hope this helps :)

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Kaustubh says:

2020-10-08 17:58:20

Hello Anushka, I acquired an Equity share on 15 February 2016, at Rs. 13,500. Its FMV was Rs. 16,675 on January 31st, 2018. The share was sold on 10 March, 2020 at Rs. 14,780. Now, that the Sale value is less than the FMV, the LTCG is NIL. Since there is NEITHER a 'Long term Capital Gain' NOR a 'Long term Capital Loss', is it mandatory for me to mention this trade in schedule 112A of ITR-2?

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Anushka Shah says:

2020-10-09 15:30:07

Hey Kaustubh, Yes. It is advisable to report all your trading transactions in the ITR since the Income Tax Department has data of all your trading activity. Thus, you must enter the details of long term trades in Schedule 112A of the ITR.

Reply

vivek sn says:

2020-10-07 06:42:59

After entering ISIN in Schedule 112A of ITR-2, the name of the share/unit is not getting populated automatically. This is happening in PR3 version of ITR-2. It was being populated in older versions of ITR2. Should I just enter the name manually or should I wait for the bug to be fixed?

Reply

Aakash Lalchandani says:

2020-10-08 15:02:11

Hey Vivek, You can retry entering ISIN and press tab button to prefill the data. If it still does not get populated, you can enter the name manually.

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Vikas Vyas says:

2020-10-03 12:33:20

Hello. Thank you for the wonderful and informative blog. In an attempt to trim my Mutual Fund Portfolio which had about 15 of them, I redeemed many Mutual Funds start of April 2019 and then again March 2020 when there was heavy crash. My LTCG gains for many Mutual funds is Zero (considering Grandfathering clause & 1 lac exemption) while others are negative. I am in shock to learn that I have enter all the transactions as though the redeemed value is same, the purchase value is different as they have been bought over period of time through SIP. There are about 700 to 800 transactions. Am I supposed to enter all of them? Entering in the ITR Java Utility is even more tedious as it takes lot of time to populate after adding one entry. Is there any better solution to this? Please help. Thanks Vikas

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Anushka Shah says:

2020-10-07 11:06:00

Hey Vikas, As per new Section 112A, in the ITR utility, the IT department added a new Schedule 112A to calculate LTCG on trade wise basis after applying grandfathering rule. Incase of non updation of the details, an e-compliance notice will be sent by the department. Hence, you will have to update all LTCG transactions while filing your returns. Or else, you can upload your trades on Quicko and we calculate your capital gains, claim expenses, set of losses automatically so you can e-file instantly.

Reply

says:

2020-10-07 05:55:26

Dear Anushka Thank you for your response. I clicked on the Upload link, however I do not have any account with the brokerage houses that have been mentioned there. However, I do have CAMS / KARVY Capital Gains Statements. Can I upload those? Also, If we do not use the Income Tax Utility portal, the Section 112A format has to be exactly as per the Income Tax Utility or it can be in one own's format as long as the goal of Long Term Capital Gains computation is achieved? Thanks for your help again. Vikas

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Anushka Shah says:

2020-10-07 11:43:45

Hey Vikas, Once you log into your Quicko account you can upload your CAMS/KARVY Capital Gain Statement by following these steps. Cams and Karvy will go live soon. In the meantime you can import data onto Quicko using Excel Utility. It is not mandatory to use the Income Tax Utility. However, for calculating the Long Term Capital Gain as per Section 112A, Gain or Loss as per the grandfathering rule has to be calculated for each trade.

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Gaurav Rastogi says:

2020-09-29 09:25:06

Dear Sir, I have filled all the details of CG 112A, but the excel sheet of ITR 2 is taxing the gain of even LTCG Rs. 275. It is not giving exemption of Rs. 1 Lakh. Where do i fill the exemption details.

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Anushka Shah says:

2020-10-02 13:11:50

Hey Gaurav, Once you enter the details of LTCG in schedule 112A, the exemption is auto calculated. You can view the details under schedule SI (Special Rate Income) in the ITR utility. Or else, you can upload your trades onto Quicko and we will calculate your capital gains, claim expenses and set of losses automatically so you can e-file instantly and with ease.

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Raj says:

2020-10-16 18:56:06

I have filled Schedule 112A and have LTCG from sale of MF of only Rs 7800/- The same is correctly reflected in Schedule CG, row B4A. However unlike previous year versions of ITR 2, where LTCG after threshold limit of Rs 1.0 lakh was taxed, there is no such provison in the current ITR. I did try to find any such LTCG threshold exemption in Schedule EI too, but to no avail. Filling the relevant data manually in Schedule EI, did not solve the issue as the 10% LTCG tax rate on Rs 7800/- was also auto populated in Schedule SI. I believe that an additional row of LTCG threshold exemption/calculation of the same is missing in Schedule 112A or Schedule CG.

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Gokul says:

2020-10-22 19:20:24

You are right. I am also facing same issue.

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Aakash Lalchandani says:

2020-10-19 17:04:42

Hey Raj, If it is an equity mutual fund, then schedule 112A will come into the picture. If it is Debt MF then Schedule 112A is not applicable. Fill all the details of trades in 112A and after that, capital gains will get auto-populated. Then Schedule SI will get auto-calculated with an exemption of 1 lakh and calculate 10% on the remaining amount. Make sure all details in Part A general are properly filled. Hope this helps 🙂

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Prabha says:

2020-09-29 02:28:11

Hello Madam, I have STCG from equity shares and equity mutual funds. In the ITR2 for the AY 20-21, do I have to disclose it individually or disclose only the total redemption value and the total cost of the shares/mutual funds in schedule CG. Also I understand that LTCG from equity shares and equity mutual funds are to be entered in form 112A scrip wise. what about the LTCG from debt mutual funds, is there a place to show each transaction separately or the total redemption value and total cost of the debtfunds should be disclosed in schedule CG? Please advise. Thank you.

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Anushka Shah says:

2020-09-30 10:53:05

Hey Prabha, Sec 112A is applicable FY 2018-19 (AY 2019-20) onwards to levy 10% income tax only on Long Term Capital Gains on the sale of equity shares, equity mutual funds and units of business trust in excess of Rs.1 lac for a financial year. For showing STCG you can still report aggregate sale purchase values. While for LTCG in debt mutual funds, you should show the total value under schedule Capital Gains.

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PRABHA says:

2020-10-01 21:49:29

Appreciate very much your detailed reply. I have got the statement regarding the trades executed during the FY 2019-20 from the brokers. But they do contain ISIN of the equity shares and mutual funds traded. How do I get the ISIN of the above? Thank you

Reply

Anushka Shah says:

2020-10-02 13:18:00

Hey Prabha, The ISIN Codes should ideally be in your brokers statement. However, you can use the NSDL Website to look up ISIN Codes by entering the company's name.

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Unni says:

2020-09-27 12:31:13

Lot of accurate information here. Many thanks. I have a question, which arising from some confusing news I read in some newspapers. I didn't sell any mutual funds in 2019-20. However, I have several SIPs and this resulted in lot of BUY transactions in 2019-20. First questions is that should this be shown in the section 112A? (I don't see any option there to not to provide a 'sell' price). Second question is related to the 'grand fathering' rule. Some news I read mentions that I have to report all my holdings before the data 2018 Jan 31 NOW to benefit from this rule. What I understand from what is written here is that I have to quote all that only after I sell those units at some some point of time. So, can I not fill up anything in 112A and still benefit from the grand fathering rule, say in a future year, when I sell those units?

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Anushka Shah says:

2020-09-28 14:16:52

Hey Unni, Sec 112A is applicable FY 2018-19 (AY 2019-20) onwards to levy 10% income tax on Long Term Capital Gains (LTCG) on the sale of equity shares, equity mutual funds and units of business trust in excess of Rs. 1 lac for a financial year. LTCG will only arise once you sell your assets. Hence, since you have not sold any units in FY 2019-20, you cannot report the same under Sec 112A. Further, you will get the benefit from the grand fathering rule in the year you sell your units and earn LTCG.

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Dinesh says:

2020-09-25 12:35:44

Hello, For AY20-21, Schedule 112a is compulsory for all STT paid transactions. But Nifty Options (F&O) don't have any ISIN. How can I report those transactions on 112a if I am ok to show such F&O gains as STCG transactions, instead of business income? Will take appreciate your help. Thanks!

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Anushka Shah says:

2020-09-28 10:46:51

Hey Dinesh, 1. 112A is only for LTCG on equity shares and equity mutual funds 2. F&O income should be treated as non speculative business income and not capital gains. You need to file ITR-3 for the same

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Venkat j says:

2020-09-13 01:13:52

hi, I did not trade directly any equity shares but I have invested in PMS who does mange portfolio and indulge in selling and buying of equity as a pooled investment. Is it mandatory for me to fill 112 A schedule showing HUNDREDS of equity shares sold on my behalf by the PMS agency which are of long term capital gain nature. The net is a big loss on these shares as per the audited report sent . Is there any way to record just the figue of TOTAL LONG TERM CAPITAL LOSS as per the audit report ?

Reply

Anushka Shah says:

2020-09-17 13:31:33

Hey Venkat, Since these trading transactions are on your PAN, they must be reported in your Income Tax Return. In the case of Long Term Capital Gain on the sale of equity shares, it is mandatory to fill Schedule 112A in the ITR with tradewise details. Connect with one of experts who could guide you through this process- https://plans.quicko.com/plan_CC3553

Reply

SRINIVAS says:

2020-09-12 06:39:29

HELLO MAM,I HAVE INVESTED IN MORE THAN 10 MUTUALFUND BY SIP AND REDDEMED ALL IN DEC19 I HAVE CONFUSHION SHOULD I MAKE IN DEATIAL WHICH MAY COME AROUND 400 ROWS OR FUND WISE CONSLEDATED ENTREY

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Anushka Shah says:

2020-09-17 13:46:24

Hey Srinivas, Long Term Capital Gains on the sale of equity mutual funds should be reported in Schedule 112A of the Income Tax Return. It is mandatory to fill Schedule 112A in the ITR with tradewise details to calculate accurate capital gains on sale of mutual funds. Connect with one of experts who could guide you through this process- https://plans.quicko.com/plan_CC3553

Reply

Ankit Garg says: (Awaiting Approval)

2020-11-18 10:04:09

Can I file ITR-1 if my capital gains is NIL/ZERO after grandfathering?

Reply

Chetan says:

2020-09-06 02:08:15

Hello Madam, I sold one companies shares in March 2020. In this some shares were short term (less than 1 yr) and some were long term (more than 1 yr). In this case how to add these details in section 112A? Could you please explain? Thanks and Regards Chetan

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Anushka Shah says:

2020-09-07 12:02:09

Hey Chetan, Income on sale of the shares that are held for less than a year is Short Term Capital Gain. You can calculate STCG as the difference of Sales Value and Buy Value of such units held for less than a year. Income on sale of the shares that are held for more than a year is Long Term Capital Gain. Such details should be entered in Schedule 112A. Enter number of units, sell value per unit, total cost of acquisition (buy value per unit * long term units) and FMV per unit. LTCG would be calculated as per the grandfathering rule.

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Monty says:

2020-09-05 14:39:09

In the new form that I downloaded today it shows correct calculations of LTCG, unlike the old form where the exclusion of 1 lakh was not reflected. Hope this helps.

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Jnanesh says:

2020-09-04 13:24:29

For a given ISIN reported in a row in schedule 112A, all the shares sold in a single transaction should have the same sale price per share (to be reported in Column 5). However their individual costs of acquisition per share may be different as they would have been purchased over a period of time. So Column 8 should report the aggregated cost of acquisition for these shares sold in a single transaction. Is my understanding correct? Many thanks!

Reply

Anushka Shah says:

2020-09-05 05:47:29

Hey Jnanesh, To calculate LTCG under Section 112A, the cost of acquisition is calculated after considering sales price, buy price and FMV as on 31/01/2018. Thus, each of these would be considered as a different trade. The final cost of acquisition for each trade would be higher of buy price or (lower of sales price and FMV).

Reply

Ramanujan says:

2020-10-12 04:29:52

Dear madam, I have about 10 trades during ay20-21. Some are capital loss and some gains. The final total in column 14 of sched 112a is negative after deducting positive figures. My question is do I carry only the negative figure to B4 of sched.CG or total of +be and -ve. Pls help

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Aakash Lalchandani says:

2020-10-13 13:56:15

Hey Ramanujan, The treatment of Long term capital losses are: Treatment in Same Year: Long Term Capital Losses(LTCL) can be set off against other LTCG. It can not be set off against STCG and any other income. Treatment in Next Year: Long Term Capital Losses(LTCL) can be carried forward for 8 years and set off against Capital Gains only. The treatment of Short term capital losses are: Treatment in Same Year: Short Term Capital Losses(STCL) can be set off against other STCG and LTCG. It can not be set off against other incomes. Treatment in Next Year: Short Term Capital Losses(STCL) can be carried forward for 8 years and set off against Capital Gains only. You can either choose to carry forward your losses, or you can set them off against your gains as mentioned above. Refer to this link for treatment of capital losses/gains. It is advisable to report all your trading transactions in the ITR since the Income Tax Department has data of all your trading activity. Thus, you must enter the details of long term trades in Schedule 112A of the ITR. Hope this helps :)

Reply

BKJETHANI says:

2020-10-12 18:35:24

I sold about 8 trades of different mutual funds schemes during financial year 2019-20. In which some are LTCG & some are LTCL. During filling my ITR my software showing only positive figures (e.g. Only LTCG) in my computation. Also negative figures like LTCL not adjusted with positive figures like LTCG. Hence in 3 schemes in which I earned LTCG charged capital gain tax but other 5 schemes in which I have long term loss , no benifits seen. I guess capital gain charged in net capital gain (LTCG less LTCL). Plz guide

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Aakash Lalchandani says:

2020-10-13 13:33:26

Hey BKJETHANI, Treatment in same year: Long Term Capital Losses(LTCL) can be set off against other LTCG. It cannot be set off against STCG and any other income. In your case, your LTCG and LTCL from your trades have been set off against each other. You can also refer to the article for treatment of long term capital gains/losses. Hope this helps!

Reply

yuvaraj says:

2020-08-30 13:38:57

Hello Anushka, I have just prepared a tax file whereby most income pertains from STCG and LTCG but I did not complete Schedule 112A. Finally, when I did recalculate it gave me no error and did not ask that Schedule 112A be completed. Before submitting thought I will check with you. Your advise please. Yuvaraj

Reply

Anushka Shah says:

2020-09-02 06:32:17

Hello Yuvraj, LTCG from sale of equity shares and equity oriented mutual funds is calculated in the ITR only once the details are entered in Schedule 112A. The details of LTCG are auto-populated in B4 of Schedule CG of ITR-2 and B5 of Schedule CG of ITR-3. You can read more about Long Term Capital Gain Tax on Shares - Equity Shares & Equity Mutual Fund here. Feel free to write to us at help@quicko.com for any queries :)

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poddar says:

2020-08-29 11:23:15

I am filling ITR-2 for AY 2020-2021 and need clarity on following: Since I have superannuated at end May 2019, I received the following 1. EPF accumulations (in month of Nov) 2. Gratuity (Rs 19L) 3. Leave encashment (Rs 5L ). Q1. What are the exemption limits if each on these ? Q2. Since EPF balance earned additional interest for 5months, how is that interest income treated. Q3. Where do I show these 3 types of receipts in the ITR2. Thanks

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Anushka Shah says:

2020-09-10 05:46:59

Hey Poddar, 1. The exemption limits for Gratuity are determined based on the type of employee (Government employee or other) 2. Leave Encashment has three criteria's and the exemption is to be limited to the least of those three. 3. Any payment received from a Provident Fund, (i.e. to which the Provident Fund Act, 1925 applies) is exempt.

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Prasoon Sharma says:

2020-08-29 05:33:28

The broker does not provide a consolidated statement of the expenses occured during the transfer of shares. What is the way around.

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Anushka Shah says:

2020-09-02 06:25:22

Hey Prasoon, You can download a report for expenses from the broker's platform and the total expense can be manually entered against the capital gains. Hope this helps :)

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Prasoon Sharma says:

2020-09-10 05:14:53

Your blog is the best I have come across. It solved many of my problems.Your guidance is of great help. However I want to report that many a times in ITR2 I faced the problem of the software not responding properly. At times I had number of difficulty in putting ISIN and INF nos.

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Anushka Shah says:

2020-09-10 18:17:08

Hey Prasoon, If you are filing using the ITR-2 Utility of Income Tax Department, you will have to enter each trade separately in Schedule 112A. Once you enter the ISIN, the description would be auto-populated. If you want to enter multiple trades, use the Excel Utility. You can reduce the hassle and file your taxes online using Quicko, ITR 2 will be live shortly. Stay tune for updates.

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Poddar says:

2020-08-28 11:41:04

For schedule 112A, for the equity purchase and sale both after 1st Feb 2018, also the form is insisting on filling fair market value on 31st Jan 2018. But I did not have the holding then. Should I enter it as "0"?

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Anushka Shah says:

2020-08-29 10:42:54

Hey Poddar, For equity shares or equity mutual funds purchased on or after 1st Feb 2018, the grandfathering rule does not apply for calculation of Long Term Capital Gain. Since the FMV is not considered for calculation of LTCG, you can enter the FMV as zero. Hope this helps :)

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Poddar says:

2020-08-29 11:18:27

Thanks. Seems logical.

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Anushka Shah says:

2020-08-31 06:35:07

Glad we could help!

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Bhaskar says:

2020-08-26 19:27:07

There no option to deduct 1lakh exhempt on LTCG of equity MF in ITR2 of 2020. Is there a solution? Also there seems to be a bug where we report STCG from debt MF, in the java utility. It is not validating even if filed correctly. Any thoughts?

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Anushka Shah says:

2020-08-28 09:54:58

Hi Bhaskar, Once you enter the details of long term trades on sale of equity shares in Schedule 112A, you can view its tax calculation in Schedule SI i.e. Schedule for Special Rate Income. The tax liability is calculated at 10% in excess of INR 1 lac. STCG on sale of Debt Mutual Fund should be reported in A5 under Schedule CG of ITR-2. You can click on Recalculate to calculate the taxable income and tax liability. STCG on Debt Mutual Funds is taxed at slab rates.

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Jayaram says:

2020-09-02 16:22:58

Hey Madam, My entire LTCG on Equity oriented fund and shares is less than 38,590. When I saw in Schedule "SI" it was considered as taxable. No idea why I lakh deduction was not considered. Did set off and re calculated several times but it remained the same and was taxed @ 10% Any help? Thq

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Anushka Shah says:

2020-09-05 05:42:24

Hey Jayram, LTCG on sale of equity shares / mutual funds on which STT is paid is a Special Rate Income. It is taxed at 10% in excess of INR 1 lac. Thus, tax should not be calculated on the same. Make sure you have selected the residential status and entered details of LTCG in Schedule 112A of the ITR Form so that the details are populated in the correct head under Schedule CG.

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Kannan says:

2020-08-25 16:07:42

Respected madam, Thanks a lot for the explanation with example. It confirms my understanding in filling 112A schedule. The misunderstanding what i had was that, in the utility, sale price and FMV are entered as price per share but in the 'Cost of Acquisition', we have to enter the total purchase value not purchase price per share. I appreciate your valuable service to the public.

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Anushka Shah says:

2020-08-26 08:51:05

We are glad we could help :)

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Divyesh Jain says:

2020-08-24 02:55:53

Hi, I am having a loss from LTCG transactions of only Rs. 30K.Is it necessary to report it transactionwise in Schedule 112A? or can I ignore the schedule. Divyesh

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Anushka Shah says:

2020-08-25 08:11:08

Hi Divyesh, The Income Tax Department has details of all trading transactions from your broker. We would advise you to report tradewise details of LTCG in Schedule 112A to avoid any query or notice. Hope this helps :)

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Kannan says:

2020-08-23 16:06:53

In the utility, while filling trade details in schedule 112A of ITR-2, if the trade value is LTCL the last column is showing only zero not as negative value(Loss) How to enter long term capital loss in ITR-2 Unless it comes as loss (net basis) it may may not reflect in CG schedule to carry forward loss. Kindly suggest how to enter LTCL arised out of equity shares/MFs. If possible Pl. provide some example that generate negative value in P/L column of 112A schedule.

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Anushka Shah says:

2020-08-25 13:55:14

Hey Kanan, In the last column of Schedule 112A, the gain or loss is reflected as zero when the cost of acquisition is derived from the sales price. You can get more information regarding the same on our Tax qna.

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Kannan says:

2020-08-23 15:59:51

Wile filling trade details in ITR-2, if the trade value is LTCL the last column is showing only zero no as negative value(Loss) How to enter long term capital loss in ITR-2 Unless it comes as loss (net basis) it may may not reflect in CG schedule to carry forward loss. Kindly suggest how to enter LTCL arised out of equity shares/MFs.

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Pradeep pokharna says:

2020-08-20 16:07:10

Scripe wise detail of short term trade and intra day trade is also necessary??i have 3000 trades...how it is possible

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Anushka Shah says:

2020-08-21 10:08:39

Hey Pradeep, Section 112A is applicable for Long Term Capital Gains on equity shares and mutual funds on which STT is paid. So in the case of Short Term trades and Intraday trades, you can enter aggregate details directly in Schedule CG of ITR and not in Schedule 112A.

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Kamlesh pokharna says:

2020-08-21 14:42:33

Thanks for your valuable reply... But my CA sir told me that he has to each and every trade in itr 3 form...than should i take 2nd opinion...

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Murty Joka says:

2020-08-20 07:03:21

1. Details of LTCG of equities shall be entered in Section 112a with ISIN no. WHere as equity MF transactions wont have ISIN no. How to fill MF LTCG in 112a? 2. Broker's CG report indicate Fair Market Value per share is given where applicable. This column in Section 112a is accepting only numeric. how to fill it when it is not applicable?

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Anushka Shah says:

2020-08-21 10:00:46

Hey Murty, Just like equity shares, Equity Mutual Funds also have ISIN. You can enter the ISIN and FMV as on 31st Jan 2018 in Schedule 112A to calculate LTCG. If an equity share or equity mutual fund is purchased on or after 31st Jan 2018, grandfathering rule is not applicable, so FMV is not considered to calculate LTCG. You can enter FMV as 0 in such cases.

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Prabhu says:

2020-08-15 07:20:28

Sir/ Madam, Do we have to fill details even if LTCG is less than 1 lakh?

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Anushka Shah says:

2020-08-17 12:22:50

Long term capital gains below Rs. 1 lakh threshold has to be reported in order for the Income Tax Department to know that specific amount of exemption has been claimed on LTCG from equity investments.

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Prabhu says:

2020-08-18 06:48:22

Thank You Mam for the reply. I have one more doubt. I had some STCL (6000 Rs)and some LTCG (30000 Rs)in FY 2019-20. When filing ITR the STCL got automatically adjusted against LTCG which I dont want because I want to adjust it against STCL of FY 2020-21. How is it possible?? Thank You

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Anushka Shah says:

2020-08-19 06:05:12

Hey Prabhu, The Income Tax rules for set-off and carry forward of loss are auto-calculated when you file your Income Tax Return. So, the taxpayer does not have an option to adjust a specific loss against a specific income. Instead, as per the set-off rules, a loss is set-off in the following manner: intra-head i.e. same income head for current year, inter-head i.e. different income head for current year and remaining loss is carried forward to be set-off against future incomes. You can read more about it here - Set Off and Carry Forward Losses under Income Tax Act Hope this helps :)

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Prabhu says:

2020-08-19 08:38:03

Oh..I see. Thank You very much for helping out mam.

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Dhiresh says:

2020-08-10 07:29:46

I have few queries as below: 1. Do we need to add all entries (which may be some hundreds) of all shares purchased on different dates in Section 112A? 2. Similarly, do we need to add all Equity Mutual funds purchased on different dates (through SIP) in Section 112A? 3. Is it mandatory to fill section 112A looking at large number of entries (may be 300-400) of shares and MFs purchased before Jan 2018 and sold in FY19-20, also purchased after Jan 2018 and sold in FY19-20? Mainly the MFs entries will be huge as number of schemes and SIPs every month, there will be many entries and that to for few years. It is really a very tedious work. 4. If all transactions are entered in section 112A then what and how to fill section CG for equity gain? 5. How the Debt Mutual Funds STCG and LTCG is captured in ITR-2, in which section? Thanks in advance, Regards Dhiresh

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Anushka Shah says:

2020-08-14 10:06:37

1. Yes. It is mandatory to enter details of each trade in Schedule 112A for equity shares and equity mutual funds. LTCG of each trade is calculated after considering FMV as on 31st Jan 2018 as per grandfathering rule. FMV should be considered for shares or units purchased on or before 31st Jan 2018. For others, you can add an aggregate amount. 2. The only way to compute LTCG of securities on which STT is paid is to enter details in Schedule 112A from which it is populated. Thus, it is mandatory to enter trade-wise details of all shares and mutual funds purchased after 31/01/18 and sold in FY 2019-20. 3. STCG from Debt Mutual Funds should be entered in Schedule CG > From sale of assets other than at A1 or A2 or A3 or A4 above. Enter details for 'assets other than unquoted shares'. 4. LTCG from Debt Mutual Funds should be entered in Schedule CG > From sale of assets where B1 to B8 above are not applicable. Enter details for 'assets other than unquoted shares'. You can drop in your contact details at help@quicko.com so that one of our experts can get in touch with you.

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AMARNATH says:

2020-08-19 09:01:59

From your reply as below I like some clarification. Quote: //It is mandatory to enter details of each trade in Schedule 112A for equity shares and equity mutual funds. LTCG of each trade is calculated after considering FMV as on 31st Jan 2018 as per grandfathering rule. FMV should be considered for shares or units purchased on or before 31st Jan 2018. (This is clear)// //For others, you can add an aggregate amount.// - Whether it is related LTCG for equity shares purchased after 31st Jan 2018. If so in which column it should be reported -(ITR-2)

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Anushka Shah says:

2020-08-21 10:10:09

Hey Amarnath, LTCG for equity shares or equity mutual funds purchased after 31st Jan 2018 should also be entered in Schedule 112A. However, if there are a large number of such trades, you may enter the aggregate values of sales and purchases on scripwise basis (instead of tradewise basis). The total LTCG from Schedule 112A is populated in Schedule CG of ITR.

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