Sunday, October 24, 2021
Home Income Tax Import Schedule 112A in Java Utility AY 2020-21 from excel

Import Schedule 112A in Java Utility AY 2020-21 from excel

Income Tax Return (ITR) filing season has picked up its speed and taxpayer should be well aware of the data to be entered in their respective ITR Form for AY 2020-21. We are going to discuss the provisions of Section 112A in detail and will share the process on how to import Schedule 112A in your ITR Java Utility for AY 2020-21.

In our ITR Schedule 112A, we have to give reporting about the details pertaining to transactions related to LTCG arising from the transfer of equity shares, units of an equity-oriented fund, or a unit of a business trust

.

schedule 112a itr details of capital gain details of equity share and mutual funds in itr form ay 2020-21

In many cases, we have observed that there is a huge amount of entries that may cover several pages even for a single scheme of Mutual fund for the purpose of Schedule 112A. It is a tedious job for a taxpayer or even for a professional like CA who are filing returns on behalf of their clients.

Asset management companies or brokers report they do not contain any standardized format that will help the taxpayer to enter details pertaining to their investment in their Schedule 112A – ITR Form.

Schedule 112A ITR AY 2020-21

It is advisable to keep and maintain the details in Excel from the beginning of the year till the end so that at the time of filing of ITR Form it will not become a hassle for you to fill the details.

So, in order to make it easier for the taxpayer and to the professionals, we have just created an excel that can reduce your effort and time in filling the Schedule 112A. Excel details containing details pertaining to Schedule 112A can be easily imported in your Income Tax Return (ITR) Java utility for AY 2020-21.

The Finance Act, 2018 inserted a new Section 112A which is effective from the Assessment Year 2019-20. As per the Section 112A, long-term capital gains arising from the transfer of an equity share(s), or a unit(s) of an equity-oriented fund or a unit(s) of a business trust shall be taxable at the concessional rate of 10% (i.e. without the benefit of indexation) of such capital gains.

The tax under Section 112A shall be leviable for the amount of Capital gain which is in excess of Rs. 1 lakh.

Let us First understand, how to consider a Capital Asset as “Short Term Capital Asset” or a “Long Term Capital Asset”.


Short Term Capital Asset

Any capital asset which is held by the taxpayer for a period of not more than 36 months immediately preceding the date of the transfer of such capital asset will be considered as a short-term capital asset.

Long Term Capital Asset

Any capital asset which is held by the taxpayer for a period of more than 36 months immediately preceding the date of the transfer of such capital asset will be considered as a long-term capital asset.

However, there are certain assets like Equity shares or preference shares that are listed in a recognized stock exchange in India (listing of the shares is not mandatory if the transfer of such shares took place on or before 10th July 2014), units of equity-oriented mutual funds, listed securities like debentures and Government securities, Units of UTI and Zero-Coupon Bonds, the period of holding for the purpose of ascertaining the nature of the capital asset is to be considered as 12 months instead of 36 months.

Further, from Assessment Year 2017- 18, the period of holding is to be considered as 24 months instead of 36 months in case of unlisted shares of a company, and

From Assessment Year 2018-19, the period of holding for the purpose of ascertaining the nature of the capital asset is to be considered as 24 months instead of 36 months in case of immovable property being land or building or both.         

This concessional rate of 10 percent will be applicable only if the below-mentioned conditions are satisfied:

a) in a case of an equity share(s) in a company, securities transaction tax (STT) has been paid on both acquisition and at the time of transfer of such capital asset; and

b) in a case a unit(s) of an equity-oriented fund or a unit of a business trust, securities transaction tax (STT) has been paid on transfer of such capital asset.

Now let us understand how to determine the cost of acquisitions of a listed equity share(s) acquired by the taxpayer before 1st February 2018, shall be deemed to be the higher of the following:

The Actual cost of the acquisition of such assets orLower of the following:Fair Market Value of such shares as on the date of 31st January 2018 orActual sales consideration on its transfer.

The Fair market value of the listed equity share(s) shall mean its highest price quoted on the stock exchange as on date 31st January 2018.

However, if there is no trading activity of the said shares on 31st January 2018, the highest price of such share as on the date immediately preceding the day 31st January 2018 on which the trading happens in that particular share shall be deemed as its fair market value.

In case of the units which are not listed on any recognized stock exchange, the net asset value of such units as on the day 31st January 2018 shall be deemed to be the Fair Market Value.

In a case where the capital asset is an equity share of a company which is not listed on a recognized stock exchange as on the date 31st January 2018 but listed on the date of transfer, in that case, the cost of unlisted shares as increased by cost inflation index for the financial year 2017-18 shall be deemed to be its Fair Market Value.

Illustration 1.

Mr. Goyal is a salaried employee. In the month of January 2015, he bought 100 quantity shares of XYZ Ltd. at a price of Rs. 1,400 per share from Recognize Stock Exchange. These shares were further sold through the recognized stock exchange in the month of April 2019 at the rate of Rs. 2,600 per share.

The highest price of XYZ Ltd. shares quoted on the stock exchange on 31st January 2018 was Rs. 1,800 per share.

Determine the nature of capital gain in this case?

Shares that were bought in January 2015 were sold in April 2019, i.e. the period of holding them is more than 12 months and, hence, the gain is long-term capital gain (LTCG).

In the given case, shares are sold after holding them for a period of more than 12 months, shares are sold through a recognized stock exchange and the said transaction is liable to security transaction tax (STT). Therefore, it will attract section 112A.

Determination of the cost of acquisition of XYZ Ltd. shares shall be higher of (Schedule 112A):

The Actual cost of the acquisition of such assets i.e. 1,40,000 (1,400 × 100)Lower of the following: Fair Market Value of such shares as on the date of 31st January 2018
Highest price quoted as on 31-1-2018 i.e. 1,80,000 (1,800 × 100) or
actual sales consideration on its transfer. i.e. 2,60,000 (2,600 × 100)  

Thus, the cost of acquisition of shares of the shares shall be Rs. 1,80,000.

Accordingly, Long-term capital gains arise in the hands of Mr. Goyal i.e. Rs. 80,000 (i.e. 2,60,000 – 1,80,000).

As the amount of long-term capital gains doesn’t exceed Rs. 1,00,000 therefore nothing will be taxable in the hands of Mr. Goyal.

Illustration 2;

Mr. Sharma is a salaried employee. In the month of July 2017, he bought 100 quantity of shares of ABC Limited at the rate of Rs. 2,000 per share from recognized Stock Exchange.

These shares were further sold through the recognized stock exchange in the month of June 2019 at the rate of Rs. 4,900 per share and the highest price of ABC Limited share quoted on the stock exchange as on 31st January 2018 was Rs. 3,800 per share. (Schedule 112A)

Determine the nature of capital gain in this case?

Shares that were bought in July 2017 and sold in June 2019 will be considered as a long-term capital gain (LTCG)s as the period of holding such share is more than 12 months.

In the given instance, shares are sold at a recognized stock exchange after holding them for a period of more than 12 months, and the said transaction is liable to security transaction tax (STT).

Hence it will attract the provision of section 112A.

Determination of the cost of acquisition of ABC Limited shares shall be higher of:

The Actual cost of the acquisition of such assets i.e. 2,00,000 (2,000 × 100)Lower of the following: Fair Market Value of such shares as on the date of 31st January 2018
Highest price quoted as on 31-1-2018 i.e. 3,80,000 (3,800 × 100)
or Actual sales consideration on its transfer. i.e. 4,90,000 (4,900 × 100)  

Thus, the cost of acquisition of the shares shall be Rs. 3,80,000.

Accordingly, Long-term capital gains arise in the hands of Mr. Sharma of Rs. 1,10,000 (i.e. 4,90,000 – 3,80,000).

As the amount of long-term capital gains exceeds Rs. 1,00,000, provision of Section 112A will be attracted and Mr. Sharma is liable to pay at the tax at a rate of 10% on Rs. 10,000 i.e. the amount of gain exceeding Rs. 1,00,000.

Illustration 3:

Mr. Kailash (whose residential status is non-resident) bought listed equity shares of an Indian company DEF limited in the month of December 1995 for Rs. 28,100.

These shares were further sold outside the recognized stock exchange in the month of April 2019 for Rs. 5,00,000.

Mr. Kailash does not have any other taxable income in India.

Determine his tax liability.

Mr. kailash has the following two options available with him:

ParticularsOption 1 (Avail indexation)Option 2 (Do not avail indexation)
Full value of consideration5,00,0005,00,000
Less: Indexed cost of acquisition (Rs. 28,100 × 289/100)81,209
Less: Cost of acquisition28,100
Taxable Gain4,18,7914,71,900
Tax @ 20% on Rs. 4,18,79183,758
Tax @ 10% on Rs. 4,71,90047,190

From the above computation, option 2 is more favourable to Mr. Kailash.

Adjustment of Long Term Capital Gain (LTCG) against the basic exemption limit

Only a resident individual/HUF can adjust the exemption limit against LTCG. In other words, a non-resident individual and non-resident HUF are not eligible to adjust the exemption limit against their LTCG amount.

A resident individual can adjust the Long-Term Capital Gain (LTCG) but such an adjustment is possible only after making adjustments of other income.

In other words, order for adjustment will be, First income other than Long Term Capital Gain (LTCG) is to be adjusted against the exemption limit and then from the unexhausted limit (if any) that would be adjusted against the amount of Long Term Capital Gain (LTCG).

Illustration

Mr. Kaul who is of the age of 67 years and is an Indian resident is a retired person who is earning a monthly pension of Rs. 5,000.

He bought gold during December 2011, which he eventually sold in the month of April 2019.

Taxable Long-Term Capital Gain (LTCG) amounted to Rs. 3,70,000. Apart from pension income and gain on the sale of gold he is not having any other source of income.

Determine his tax liability for the year 2019- 20?

For a resident individual who is of the age of 60 years and above but who has not yet attained the age of 80 years, the eligible basic exemption limit is Rs. 3,00,000.

As we have discussed, priority will be given to the income other than LTCG first and then to the LTCG. In the given instance, Mr. Kaul is having a pension income of Rs. 60,000 (i.e. Rs. 5,000 × 12) and the taxable LTCG from the sale of gold is Rs. 3,70,000.

Thus, we will first consider pension income to adjust against the exemption limit and the balance limit i.e. the unexhausted balance will then be adjusted against the LTCG amount.

Particulars(Amount in Rupees)
basic exemption limit3,00,000
Adjust: Pension lncome60,000
Balance Exemption limit available to adjust2,40,000
LTCG3,70,000
Balance exemption limit that can be adjusted against taxable LTCG2,40,000
Taxable LTCG1,30,000
Tax @20%26,000
Rebate u/s 87A12,500
Tax13,500
Health and education cess 4%540
Total Tax payable including cess14,040

The basic exemption limit is Rs. 3,00,000, after the adjustment of pension income of Rs. 60,000 from the exemption limit balance limit available will come out to Rs. 2,40,000. The balance of Rs. 2,40,000 will be adjusted against LTCG.

Total LTCG on gold is Rs. 3,70,000 and the available limit is Rs. 2,40,000, hence, the balance LTCG left after adjustment of Rs. 2,40,000 will come to Rs. 1,30,000. The Capital Gain of Rs. 1,30,000 will be charged to tax @ 20% (plus health & education cess @ 4%). Thus, the tax liability before cess will come to Rs. 26,000 and after deducting rebate of Rs. 12,500 as per section 87A, he would be liable to pay a tax of Rs. 14,040 (including health & education cess @ 4%).

No deduction under sections 80C to 80U is allowed from long-term capital gains.

Click here to download your copy of Excel for your Schedule 112A.

Click here to Update your Notepad to Notepad ++

To know the procedure on how to import excel in your ITR Java Utility. Click here.

ITR-3 AY 2020-21 Individual: Computation of Total Income, Surcharge, Interest, and Tax Payable

CA Devesh Thakur

RELATED ARTICLES

17 COMMENTS

  1. The last LINK at the end of above article has not been enabled & hence does not work. The link needed is the procedure on how to import the EXCEL DATA into the JAWA UTILITY DRAFT XML FILE
    Kindly fix this defect and oblige.

  2. Actually was hoping for a PROCEDURAL write-up on this web-page with multiple clear screen-shots of both EXCEL as well as JAVA Utility. On the small screens of our mobile devices we were unable to understand/appreciate the final few HURRIED YET CRITICAL minutes of your u-tube video which was the core purpose of this video. Kindly assist please & oblige.

  3. I followed all the steps as you expalined; but at the end while opening the saved XML file through Javautility, I am getting following error “Invalid ITR or Assessment year”.
    Kindly help me to fix this error.

  4. I DID ALL THE STEPS AS EXPLAINED IN VIDEO BUT AT THE END I M GETTING AN ERROR OF ” INVALID ITR OR ASSESSMENT YEAR” HELP ON THIS PLEASE.

    • Dear Samar,
      The link to download the excel is provided at the end of the blog, you can download the same from there. Still, if you face some problem, kindly share your email id, we will send it to you via email.

LEAVE A REPLY

Please enter your comment!
Please enter your name here

Most Popular

Recent Comments