NRI.Besides Salary income also have short term capital gain.Tax liability, forms and challans for e remittance

I am working in Middle East since April-2007. My current salary is INR.12 Lakhs per annum and is totally non taxable.
Apart from above income, I have made a short term capital gain of about INR 2.5 Lakhs by trading in Indian stock markets in this fiscal year so far.

My annual savings includes the following.

1. Public provident Fund1.00 Lakh
2. LIC premium0.60 Lakh
3. LIC Pension scheme premium0.10 Lakh
4. Tax saver ULIP 0.78 Lakh

My queries are:

1.What is my present tax liability?
2.If there is any liability, how and where do I remit the tax?
3.Which form is to be used for filling the return?

One Reply to “NRI.Besides Salary income also have short term capital gain.Tax liability, forms and challans for e remittance”

  1. Trade is diffarent and short term capital gains are diffarent. You can treat your short term capital gains as trade stating that you are doing shares business and not investment in shares. If you treat as business, the entire income after the basic exemption limit Rs.1,10,000 is taxable. If you treat it short term capital gains, the tax on it is flat 10%. I will show you your tax liability for both cases thinking that you do not have any other income other than this shares income.

    If capital gains:
    Your short term capital gains income—– = Rs.2,50,000
    Less basic exemption for Male <65Years=RS.1,10,000

    Balance taxable———————————-= Rs.1,40,000
    Tax @10% + Educati. Cess on Tax @3%=Rs. 14,420
    (Your PPF, LIC & ULIP cannot reduce your tax for capital gains)

    If shares trade:
    Your shares trading income————————– = Rs.2,50,000
    Less basic Exemption (Male <65 years)——– = Rs.1,10,000
    Less your savings 1 to 4 total =2.48L limited to =Rs.1,00,000

    Your net taxable income=2.50-1.10-1.00——— =Rs.40,000
    Tax on Rs.40,[email protected] slab 10%+3%E.C——- =Rs. 4,120

    Regarding returns:
    If trading or for trading & capital gains—= Form ITR-4 (about 20 pages form)
    If capital gains-(No trading income at all) =Form ITR-2 (about 6 pages form)

    Payment of tax and filing of returns:
    You are having lot of time to pay taxes and filing returns. The last date for filing returns is 31st July, 2008. At prasent do not pay any advance tax. You can cooly thing over again wether to declare your shares income as trading or short term or partly trading and partly capital gains. For delay payment of taxes you only need to pay interest @12%. But if you pay excess tax it is difficult to get it back. So waite.

    Go through the articals related to shares profit:

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