What You Must Pay The Taxman After Selling Shares

  Author: Sanjay Sharma

Congratulations! You have made handsome gains by selling some of your investment in shares. Before, you start celebrating or using the money, spare a moment to check whether you need to pay any tax on capital gains you have made.   

Investments of more than a year If the shares you sold are listed and they were sold in a transaction in a stock exchange, in that case, if the investments are more than one year old, you are fully exempt from long term capital gains tax. In other words, the long term capital gains tax on sale of shares held for more than one year is nil.

Investments of less than one year In case you held the investments for less than a year, the capital gains are subject to short-term capital gains tax of 15%. Or, the capital gains in this case are classified as short-term capital gains, and are taxed at 15%.