Should I Declare Shares on My Tax Return? A Confused Investor's Query

Ans: Yes the income from mutual funds and shares is taxable as per the provision of Section 112, 112A or 111A.

Ans: Yes, there are tax implications when shares are gifted to a spouse. Here are some important points to consider:

No tax is applicable on the transfer of shares between spouses as long as the transfer is a gift and not a sale.
However, any income or capital gains arising from the gifted shares will be taxable in the hands of the spouse who receives them.
If the gifted shares are sold by the recipient spouse, any capital gains arising from the sale will be taxable in their hands.
In case the gifted shares are of a listed company, the recipient spouse will be liable to pay securities transaction tax (STT) at the time of sale.
It is advisable to keep proper documentation of the gift, including the date of transfer, the number of shares transferred, and their fair market value at the time of the transfer.
It is recommended that you consult a qualified tax professional for more detailed advice on your specific situation.

Ans: Yes, the profit on investment in the stock market in the name of your wife, who is a housewife, is taxable if the money investment has been provided by you. The income earned by a wife from her investments is considered to be the income of her husband and is clubbed with his income for tax purposes under income tax section 64. However, there are certain exceptions to this rule.

Exceptions to Clubbing of Income rule:-
• If the wife invests from her own personal income, such as income from a part-time job or rental income, and the husband has no control over the investments, then the income from these investments will not be clubbed with the husband's income.
• If the wife invests from her own funds that she inherited or received as a gift, then the income from these investments will also not be clubbed with the husband's income.
• If the wife is an investor and earns income from investing in shares, then this income will be taxed separately at the applicable rates under the Income Tax Act.

Ans: 01. Long Term Capital Gain on sale of Securities, is exempt up to Rs.1,25,000.00 with effect from F/Y 2024-25.
02 Besides this, your total income (including LTCG) shall also be exempt, up to basic limit of exemption.
Most welcome for any other clarifications. Thanks.