You can set off your short term capital loss from equity mutual funds with your short term capital gains from debt mutual funds
27-Oct-2016 •Research Desk
I have made a short term capital gain of ₹153000 on units of debt mutual fund and a short term capital loss of ₹142000 on equity mutual fund. Can I adjust the loss against gain and pay income tax on the difference as per my slab rate?
-Subodh Bhatt
Yes, you can set off your short term capital loss from equity mutual funds with your short term capital gain of debt mutual fund.
Short term capital loss arising out of both equity and debt mutual fund can to be set off against short term capital gain of equity or debt mutual fund. It can also be set off with long term capital gain of debt mutual fund. In your case, you would need to only add the difference of gain ₹11000 (₹153000-142000) to your taxable income.
Debt funds held for less than three years will attract short term capital gains tax as per your income tax slab. Debt funds held for more than three years will qualify for long term capital gain tax of 20 percent with indexation. Equity funds held for less than 1 year will attract short term capital gains tax which is 15 percent. Long term gains from equity funds are exempt from tax.
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