विशेषज्ञ की सलाह चाहिए?हमारे गुरु मदद कर सकते हैं
Dinesh
Ramalingam Kalirajan11243 Answers |Ask - Follow
Mutual Funds, Financial Planning Expert - Answered on Jun 23, 2026
Asked on - May 17, 2026
Hello sir, I hv some old shares which I purchased long time back when the shares were in physical form. Later on the same were shifted to dmat account. Now the problem is;
1. When I sold few of the shares, the a p & l account does not show capital gains based on purchase value or value as on 31 jan 2018 because they dont hv any entry of purchase rate n date in their record. How to calculate the gain so that tax is paid accordingly?
Ans: It is good that you have identified this issue before filing your Income Tax Return. Many investors who purchased shares in physical form face the same problem after moving them to a Demat account. The good news is that it can be sorted out with proper documentation.
» Why This Happens
When old physical shares are converted into Demat form, many brokers receive only the quantity of shares.
The original purchase date and purchase price are often not available in their system.
As a result, the Profit & Loss statement may show incorrect or zero cost of acquisition.
So, you should not depend only on the broker's P&L report for tax calculation.
» Find the Original Cost
Try to collect any of the following documents:
Original share certificates.
Purchase bills or contract notes.
Bank statements showing payment for the shares.
Old dividend warrants or company communications.
Portfolio statements maintained by your previous broker or registrar.
Any available evidence will help establish the purchase cost and holding period.
» Use Grandfathering Benefit if Applicable
If the shares were acquired before 31 January 2018 and sold after that date, the grandfathering provisions may apply.
In such cases, the cost of acquisition may be determined by considering the original purchase price and the market value as on 31 January 2018, as per the applicable tax rules.
This ensures that appreciation before 31 January 2018 is not unfairly taxed.
» If Purchase Records Are Not Available
Contact the company's Registrar and Transfer Agent (RTA) and request historical transaction details if possible.
Check old Income Tax Returns, wealth statements or investment records maintained by you.
If the shares came through corporate actions such as bonus, split or merger, maintain the relevant company announcements and adjust the cost accordingly.
A reasonable and well-supported calculation is always better than assuming the cost as zero.
» Maintain Proper Working Papers
Prepare a separate calculation sheet showing:
Purchase year.
Estimated or documented purchase cost.
Market value as applicable.
Sale value.
Final capital gain.
Keep all supporting documents safely for future reference in case any clarification is sought.
» Tax Planning
If the shares qualify as long-term holdings, long-term capital gains above Rs.1.25 lakh in a financial year are taxed at 12.5%.
If they are short-term holdings, the gains are taxed at 20%.
Correct computation is important because paying excess tax is as undesirable as under-reporting income.
» Finally
Do not rely solely on the broker's P&L statement when it does not contain the original purchase details.
Reconstruct the purchase cost using available records and apply the applicable grandfathering provisions wherever eligible.
Maintain proper documentation and a clear calculation sheet before filing your return. This will help ensure accurate tax payment and avoid future disputes.
Best Regards,
K. Ramalingam, MBA, CFP,
Chief Financial Planner,
www.holisticinvestment.in
https://www.linkedin.com/in/ramalingamcfp/
(more)
» Why This Happens
When old physical shares are converted into Demat form, many brokers receive only the quantity of shares.
The original purchase date and purchase price are often not available in their system.
As a result, the Profit & Loss statement may show incorrect or zero cost of acquisition.
So, you should not depend only on the broker's P&L report for tax calculation.
» Find the Original Cost
Try to collect any of the following documents:
Original share certificates.
Purchase bills or contract notes.
Bank statements showing payment for the shares.
Old dividend warrants or company communications.
Portfolio statements maintained by your previous broker or registrar.
Any available evidence will help establish the purchase cost and holding period.
» Use Grandfathering Benefit if Applicable
If the shares were acquired before 31 January 2018 and sold after that date, the grandfathering provisions may apply.
In such cases, the cost of acquisition may be determined by considering the original purchase price and the market value as on 31 January 2018, as per the applicable tax rules.
This ensures that appreciation before 31 January 2018 is not unfairly taxed.
» If Purchase Records Are Not Available
Contact the company's Registrar and Transfer Agent (RTA) and request historical transaction details if possible.
Check old Income Tax Returns, wealth statements or investment records maintained by you.
If the shares came through corporate actions such as bonus, split or merger, maintain the relevant company announcements and adjust the cost accordingly.
A reasonable and well-supported calculation is always better than assuming the cost as zero.
» Maintain Proper Working Papers
Prepare a separate calculation sheet showing:
Purchase year.
Estimated or documented purchase cost.
Market value as applicable.
Sale value.
Final capital gain.
Keep all supporting documents safely for future reference in case any clarification is sought.
» Tax Planning
If the shares qualify as long-term holdings, long-term capital gains above Rs.1.25 lakh in a financial year are taxed at 12.5%.
If they are short-term holdings, the gains are taxed at 20%.
Correct computation is important because paying excess tax is as undesirable as under-reporting income.
» Finally
Do not rely solely on the broker's P&L statement when it does not contain the original purchase details.
Reconstruct the purchase cost using available records and apply the applicable grandfathering provisions wherever eligible.
Maintain proper documentation and a clear calculation sheet before filing your return. This will help ensure accurate tax payment and avoid future disputes.
Best Regards,
K. Ramalingam, MBA, CFP,
Chief Financial Planner,
www.holisticinvestment.in
https://www.linkedin.com/in/ramalingamcfp/