How to Report Capital Gains/Losses in ITR

While filing your Income Tax Return, it is crucial to remember certain key things including holding period of assets

- Dipak Mondal @ New Delhi

IF your financial year involves buying or selling assets, understanding how to correctly report capital gains or losses in your Income Tax Return (ITR) is paramount. While a tax advisor can guide you, a basic understanding of these concepts will empower you to manage your taxes effectively.

What is a Capital Asset?

As per Section 2(14) of the Income Tax Act, 1961, a "Capital Asset" is broadly defined to include "any kind of property held by an assessee, whether or not connected with business or profession." This definition covers everything from shares, MFs to real estate, and even certain intangible assets like patents. The origin of acquisition doesn't change its status; even if an asset is acquired with tax-exempt income, it remains a capital asset.

Holding period matters