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Loss under capital gains
It is of 2 types
- STCL (Short Term Capital Loss)
- LTCL (Long term Capital Loss)
STCL [Short term capital loss]
- It can be adjusted against both STCG / LTCG in current year
- However, no inter head adjustment allowed.
- Balance is carry forward for 8 more years
- In future years it can be adjusted against LTCG or STCG
Example 1
| Particulars | Amt |
| Income from Salaries | 300000 |
| LTCG/(LTCL) | 30000 |
| STCG/(STCL) | -40000 |
| TOTAL | 290000 |
This loss of 40000 can be adjusted against LTCG only and not Income from Salaries
Remaining will be carry forwarded for 8 years
| Particulars | Amt | |
| Income from Salaries | 300000 | |
| LTCG | 30000 | |
| Less | ||
| Adjust with STCL | -40000 | 0 |
| Balance STCL Carry forward | -10000 | |
LTCL (Long term capital loss)
- It can be adjusted against LTCG only in current year( It cannot be adjusted against STCG)
- No inter head adjustment allowed
- Balance is carry forward for 8 more years
- In future years it can be adjusted against LTCG only
Hence.,
STCL can be adjusted against both STCG and LTCG
but
LTCL can be adjusted against LTCG only
Example 2
| Particulars | Amt |
| Income from Salaries | 300000 |
| LTCG/(LTCL) | -50000 |
| STCG/(STCL) | 30000 |
| TOTAL | 280000 |
This loss of 50000 cannot be adjusted against STCG or Income from Salaries
| Particulars | Amt |
| Income from Salaries | 300000 |
| STCG | 30000 |
| LTCL | 0 |
| Total | 330000 |
LTCL of 50000 can be carry forwad for 8 years
Note:-
Long term Capital loss on shares is a dead loss.It cannot be carry forward in future period
This is because Long term capital gain income is exempt.Since its income is exempt, its loss also has no treatment
