My annual income from all sources is below ₹1 lakh. I have long term capital gains of ₹10,000 without indexation from my investment in a debt fund. Am I to pay income tax on this amount? I have got a letter from the IT department, accusing me of non-filing of return for that particular year.
If you have sold your investments in debt mutual funds after three years, you have to pay long-term capital gains tax of 20 per cent with indexation benefit. You have to pay this tax while filing returns.
Your capital gains are: sale price - indexed cost of acquisition.
The formula to calculate cost of acquisition is: purchase price x cost inflation index of the year of sale/cost inflation index of the year of purchase
For cost inflation index, click here.