Scrip-wise info in ITR must only for those seeking LTCG exemption: CBDT

Topics Income tax | CBDT | ITR

The income tax department has clarified that scrip-wise details of sale and purchase of shares are required to be filled in the income tax returns for 2020-21 assessment year only by those who opted for exemption of long-term capital gains (LTCG) tax.

It denied reports that stock or day traders are required to furnish scrip-wise details in the return of income for the current assessment year.

The exemption cited above was allowed under the grandfathering clause of the Finance Act, 2018 to the gains made on listed shares up to January 31 2018. Grandfathering refers to an exemption that allows persons or entities to continue with activities or operations that were approved before the implementation of new rules.

The Budget for 2018-19 had imposed a tax of 10 per cent on long-term capital gains exceeding Rs 1 lakh.

The Central Board of Direct Taxes clarified that the scrip-wise details in the return of income for the assessment year 2020-21 is required to be filled up only for the reporting of the long-term capital gains for these shares/units which are eligible for the benefit of grandfathering.

As the grandfathering is to be allowed by comparing different values (such as cost, sale price, and market price as of August 31, 2018) for each share/unit, there is a need to capture the scrip wise details for computing capital gains of these shares/units, it said.

Without this reporting requirement, there may be situations where taxpayers may not claim or wrongly claim the benefit of grandfathering due to lack of understanding of the provisions.

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