Q. With reference to Capital Gains Tax (CGT) in India, consider the following statements:
1.Capital gains are considered a form of income and are taxed when a capital asset is transferred between owners.
2.An immovable property held for more than 12 months is treated as a long-term capital asset.
3.Equity shares held for more than 12 months are considered long-term capital assets.
Which of the statements given above is/are correct?
Answer: B
Notes:
Explanation:
- Capital gains arise from the sale of capital assets and are considered taxable income when ownership is transferred.
- For immovable property, an asset becomes long-term if held for more than 24 months, not 12 months.
- Equity shares and some financial securities are considered long-term capital assets if held for more than 12 months.
Source: Indian Economy (N.C.E.R.T)
