Comment on Taxation Simplified

Jim commented on 05 Feb 2013, 06:46 PM

Hi Zerodha,

Thanks a lot for this great initiative. I have been searching/ reading forums to understand tax implications, but only got confused after reading them. Request to keep this thread alive.

Can I request you to clarify the below query.

Assume that I fall under the 20% income tax slab (after all deductions) and have only ONE Demat account.

Suppose I made profit of:

(1) Rs. 20,000 (Short Term Capital Gain) from delivery/cash segment (NOT from Intraday).
(2) Rs. 30,000 (Business Income) from F&O (Equity) segment.
(3) Rs. 40,000 (Speculative Income) from Intraday (Equity) segment.

Q1. Kindly let me know what would be my tax liability.
(a) Will it be a total of Rs. 21,000
Calculation: 3,000 (15% of 20,000) + 6,000 (20% of 30,000) + 12,000 (30% of 40,000)
(b) Will it be a total of Rs. 27,000
Calculation: 27,000 (30% of 20,000 + 30,000 + 40,000)

Q2. If the answer to Q1 is “b”, then I guess, a flat 30% of tax (highest tax applicable to the kind of income (Business/ Speculative)) I made in that particular Demat account. In that case, will it be wise to have 2 Demat accounts, wherein one will be used exclusively for Cash/ Delivery segment (Short Term/ Long Term Capital Gains), which will be taxed at max 15% in case if I sell the stocks in less than a year…and the second Demat account will be used to make profit from F&O or Intraday, which will be taxed as per income tax slab?

Thanks in advance.

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