Accountancy Forum

Q1 A person buys and sells a number of vehicles in a tax year and makes a significant amount of profit in the process. Will such profit be taxable as capital gain?
Q2 A person somehow gets hold of an extraordinary rare bird, keeps it as a pet for two years and then sells it off. Will related profit be taxable as capital gain?

Dear,

Neither of the two profits shall be considered as capital gain, rather these are to be taxed under the head "Income from other Sources", provided that sale and purchase of vehicles is not the prime source of Income.
However, if any of the two profits is the result of prime source of Income then the same should be taxed under the head Income From Business.

Only the above two criteria should be considered for the purpose of taxation, regardless of significance of transaction amount .


Best Regards,