Classification Of Capital Assets
For the purpose of taxation, assets are classified into short term and long term assets.
How To Determine Whether An Asset Is Long Term Or Short Term?
| No | Type of capital asset | Period of holding |
|---|---|---|
| 1 | Listed shares Listed debentures and government securities Units of equity oriented mutual funds Units of UTI Zero coupon bonds |
Long term capital asset – 12 months or more Short term capital asset – Less than 12 months |
| 2 | Unlisted shares of a company Immovable property being land and building |
Long term capital asset – 24 months or more Short term capital asset – Less than 24 months |
|
3 | Any other capital assets |
Long term capital asset – 36 months or more Short term capital asset – Less than 36 months |
What Is Period Of Holding?
FROM – Date of purchase or acquisition
TO – Date immediately preceding the date of transfer.