Capital Gains Tax

General
1

Which method do you think is the right way to calculate capital gains
I think method 2 is the right way to calculate but vested uses method 1 in their tax statements.Whats your opinion on this?

Method1:
SELL Value : Net Amount/s from trade conformation PDF
BUY Value : Net Amount/s from trade conformation PDF
Gains/Losses in Dollars($)= SELL Value-BUY Value
Gains/Losses in Rupees=Gains/Losses in Dollars($) * RBI Reference Rate on the last day of the preceding month it was sold

Method2:
N.A. - Net Amount from Trade Conformation PDF
SELL Value=N.A. * RBI Reference Rate on the last day of the preceding month it was sold
BUY Value =N.A. * RBI Reference Rate on the last day of the preceding month it was bought
Gains/Losses in Rupees = SELL Value-Buy Value

1 Like
2

Hey,

Method 1 is the correct approach.

For capital gains calculation, the gain/loss is first determined in USD by subtracting the buy net amount from the sell net amount. That USD gain/loss is then converted to INR using the RBI reference rate on the last day of the month preceding the sale.

So the correct formula is:

• Gain/Loss in USD = Sell Value − Buy Value
• Gain/Loss in INR = USD Gain/Loss × RBI reference rate before sale

This is why Vested uses Method 1 in the tax statement.