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  1. shabbir

    shabbir Administrator Staff Member

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    Exactly. Tax loss harvesting is more like click bait on social media. Ideally one should book loss and then buy back share that they plan to hold for the long-term and not otherwise.
     
    shabbir, Mar 26, 2025
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  2. laveshdixit

    laveshdixit Responder

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    Thanks for the explanation.
    Good tax Savings would be there but only if the loss is significant.
    Also your conviction on the stock should be high.

    And if the stock is good anyways, then it can compensate for the loss and recover nicely over long term in which case anyways you profit and pay lesser ltcg.

    So my take is that yes tax loss harvesting is helpful but only to a small extent.
    I woyld sell the stock if my view in it has changed, and not to just save some taxes here and there.
     
    laveshdixit, Mar 26, 2025
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  3. shabbir

    shabbir Administrator Staff Member

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    Yes true but then lets do some calculation and it will help you.

    Your purchase price is ₹100.
    You booked loss at ₹70 and then repurchased the next day at ₹70.

    So on the loss of ₹30 and saved ₹6 at 20%

    Now your purchase price is ₹70 and the price goes back to ₹100 but takes one year's time. Now on the profit of ₹30 you pay ₹3.75 as LTCG tax.

    However, if you had to pay back the tax at 20% at ₹100, you don't save anything but defer the tax payment. But because the stock can take longer time to reach to that price or you can wait a little more and then sell at ₹120 as well. When you have an arbitrage of saving STCG and then waiting to gain and pay LTCG is when you have benefits. Not otherwise.

    Again, one can argue on the STT but we also have 1.25L as free slab under LTCG as well and so there is some saving for sure. However, saving on purely STCG and then paying STCG again doesn't make sense.

    Similarly, saving LTCG and then paying LTCG doesn't make much sense beyond the 1.25L tax free slab.
     
    shabbir, Mar 26, 2025
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  4. laveshdixit

    laveshdixit Responder

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    Also there are transaction charges on both sides, and one may not know the change in stock price that happens between the time you sell and buy again.
     
    laveshdixit, Mar 25, 2025
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  5. laveshdixit

    laveshdixit Responder

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    Wouldn't it be the case that your acquisition cost reduce by the loss harvested, and then when you sell, you are actually paying a higher tax as the future profit will be proportionally high. (selling prive - lower proportion cost of acquisition)
     
    laveshdixit, Mar 25, 2025
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  6. shabbir

    shabbir Administrator Staff Member

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    True but generally if I want to be holding a company for long-term, then I prefer doing tax loss harvesting for the short term and save 20% and defer the payment now and then pay 12.5%
     
    shabbir, Mar 25, 2025
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  7. laveshdixit

    laveshdixit Responder

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    There was a very interesting information that I got to know yesterday about tax loss harvesting.

    It is essentially a tax deferment exercise.
    It is not that you save tax entirely but you defer tax to the next year. I did not know this.

    Refer thisvideo, just the first part. Can ignore the second part of the video.


     
    laveshdixit, Mar 25, 2025
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  8. shabbir

    shabbir Administrator Staff Member

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    Yes it is always a good option to reduce the tax one needs to pay
     
    shabbir, Mar 25, 2025
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  9. laveshdixit

    laveshdixit Responder

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    A lot of portfolios of people might be in losses in this year. It may be a good idea to do tax loss harvesting to offset the taxes that you have to pay for booking profits in this year.
     
    laveshdixit, Mar 24, 2025
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  10. laveshdixit

    laveshdixit Responder

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    laveshdixit, Mar 24, 2025
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  11. shabbir

    shabbir Administrator Staff Member

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    shabbir, Feb 10, 2025
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  12. shabbir

    shabbir Administrator Staff Member

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    Depends on your stocks and their quarterly earnings and future outlook. Generally speaking, I don't have a view on the complete market but my stocks should continue to grow sales and profit north of 15% and that gives me confidence to remain invested.

    I am more of a bottom up approach investor and it works well for me. You can see if your stocks are doing the same or not. Market is expected to be volatile but it is part and parcel of being an equity investor but the volatility also means you have chance to enter at good levels. It is a double edge sword.
     
    shabbir, Feb 4, 2025
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  13. rahul_majumdar

    rahul_majumdar Member

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    Hi Shabbir,
    With the current mayhem in the stock market, is it wise to remain invested and hope for the best or cash out with something before the capital gets wiped out.
    Please suggest.
    Regards
    Rahul
     
    rahul_majumdar, Feb 3, 2025
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  14. shabbir

    shabbir Administrator Staff Member

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    Added
     
    shabbir, Jan 14, 2025
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  15. sanket_zarkar

    sanket_zarkar New Member

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    Hello Shabbir,

    Please add me too. Thanks
     
    sanket_zarkar, Jan 9, 2025
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  16. shabbir

    shabbir Administrator Staff Member

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    shabbir, Jan 7, 2025
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  17. shabbir

    shabbir Administrator Staff Member

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    shabbir, Nov 28, 2024
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  18. shabbir

    shabbir Administrator Staff Member

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    Added.
     
    shabbir, Nov 26, 2024
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  19. deepkn28

    deepkn28 New Member

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    Hiii Shabbir Sir,
    Could you please add me in your portfolio update and share your portfolio.

    Thank you.
     
    deepkn28, Nov 26, 2024
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  20. shabbir

    shabbir Administrator Staff Member

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    shabbir, Nov 22, 2024
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