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Direct Taxation
In this q, is it Correct if I set off 50,000 loss from house property against capital gains? It’ll be more beneficial as the tax burden is reduced .then remaining 1.5 lakh I set off against salaries ..
Answers (17)
Even if you set it off like you said, the total income wouldn't change, therefore there will be no difference in tax liability. Because total income will be allocated towards flate rates first before normal slab rates ( 1st Casual income-30% then LTCG/STCG then normal rates)
Abishek M
Even if you set it off like you said, the total income wouldn't change, therefore there will be no difference in tax liability. Because total income will be allocated towards flate rates first before normal slab rates ( 1st Casual income-30% then LTCG/STCG then normal rates)
Yes the Gross total income is same .. however deduction varies as u can claim a maximum of gross total income -capital gains-cadual income .. so the income tax liability differs ..
Abishek M
Even if you set it off like you said, the total income wouldn't change, therefore there will be no difference in tax liability. Because total income will be allocated towards flate rates first before normal slab rates ( 1st Casual income-30% then LTCG/STCG then normal rates)
Also with my solution, there’s no capita gains .. so it can’t be taxed at a separate rate .. that also causes a difference in tax liability
Yes even i have seen in one of the questions where the answer suggested to set it off with capital gains to reduce the burden. Unfortunately i couldn't remember which mtp it is.But yes you can set it off since it is allowable tj be set off with any other income.
Thread Starter
SANSKRITI BADRI 2111339Also with my solution, there’s no capita gains .. so it can’t be taxed at a separate rate .. that also causes a difference in tax liability
In this prob the tax liability will be Total income= 115000 1)Tax on Casual income first= 45000x30% = 13500 Remaining balance in Total inc= 70000 2)LTCG= 70000x20% = 14000 3) normal slab rate 0 Total tax= 27500+ cess Even if you set off cg or not, from the total income the flat rate incomes will be taxed first.
Abishek M
In this prob the tax liability will be Total income= 115000 1)Tax on Casual income first= 45000x30% = 13500 Remaining balance in Total inc= 70000 2)LTCG= 70000x20% = 14000 3) normal slab rate 0 Total tax= 27500+ cess Even if you set off cg or not, from the total income the flat rate incomes will be taxed first.
Total income is 95000 Therefore LTCG is 50000x 20% 10000 Total tax will be 23500+ cess My bad I took GTI as TI, but hope u got my logic
Abishek M
Total income is 95000 Therefore LTCG is 50000x 20% 10000 Total tax will be 23500+ cess My bad I took GTI as TI, but hope u got my logic
Yes I did .. so ultimately it won’t matter right ..?
CA Suraj Lakhotia Admin
Set-off is done to give the least tax - most beneficial to assessee.
Sir so if there’s nil capital gains it’ll be most beneficial for the assessee?
Thread Starter
SANSKRITI BADRI 2111339Sir so if there’s nil capital gains it’ll be most beneficial for the assessee?
But in solution they have not done that
Thread Starter
SANSKRITI BADRI 2111339But in solution they have not done that
Can we set off other losses against Long Term Capital Gains?
CA Suraj Lakhotia Admin
Can we set off other losses against Long Term Capital Gains?
Sir but income from house property is. A free loss .. can’t we set it off against capital gains
Thread Starter
SANSKRITI BADRI 2111339Sir but income from house property is. A free loss .. can’t we set it off against capital gains
You can. But can we set off any loss other than house property against salaries
Shiva Teja Faculty
Yes you can do that. However, it’s a general practice that HP loss is set off with salaries. But your interpretation is also very much right 👍👍
Sir, since the total income doesn't change, will there be any change in tax liability ( if we completely set off against CG vs if we set off against salary)?
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