#adigitalblogger #tax #myth
Tax myths among Investors and Traders:
Myth 1 – You don’t have to pay income tax on share market earnings
. The income you generate from share market trading is taxable, even though the rate changes.
Myth 2 - You have to pay income tax every year on your share market profits
For short-term gains, within 12 months, you are taxed at a 15% rate, but if you hold shares for the long term, you are taxed at the rate of 20%, which means you are taxable only when you sell and make a profit. This means that the investment is not taxable during the holding period.
Myth 5 – Income tax laws for share market investors are the same as those for individual taxpayers
Individual taxpayers are taxable based on their fixed income, business income, salary income, or other sources. They pay tax subject to tax slabs.
The income of share market investors is uncertain based on their profits and market volatility. Here the tax is based on the type of investment in the stock market, whether it is long-term or short-term.
