Understand the term. See an example. Continue with a tool or a deeper explanation.
Start with the income period. References to 87A, 111A and 112A name provisions of the Income-tax Act, 1961, relevant to FY 2025–26 / AY 2026–27 and earlier periods. For income from 1 April 2026, use the Income-tax Act, 2025 and the relevant Tax Year. The entries identify corresponding provisions where stated.
Read the Department’s transition guide ↗
Educational definitions · Sources reviewed 14 September 2026. Check the applicable period, amendments and complete conditions before acting. Examples illustrate the concept and do not determine individual tax or investment outcomes.
Income Tax
87A — Resident-individual rebate
A reduction of eligible income-tax, subject to the income limit and regime. Section 87A is the 1961 Act reference; the corresponding 2025 Act provision is section 156.
Example. Compare two otherwise identical records with different tax already paid: the rebate follows the eligible tax computation, not the size of the TDS credit.
Back to terms ↑Capital Gains
111A — Specified short-term capital gains
The 1961 Act provision for specified equity-related short-term gains, with transaction conditions. For the 2025 Act, see section 196. It does not cover every short-term gain.
Example. Keep an equity disposal and a gold disposal on separate rows; the same holding duration does not establish the same tax category.
Back to terms ↑Capital Gains
112A — Specified long-term capital gains
The 1961 Act provision for specified equity-related long-term gains, with statutory conditions and an annual threshold. For the 2025 Act, see section 198.
Example. Combine qualifying disposals for the relevant year before checking the annual threshold; do not give each trade its own allowance.
Back to terms ↑Income Tax
26AS — Annual tax statement
A tax statement used to reconcile reported tax deductions and collections with your records. Use the statement and form applicable to the selected period, alongside AIS and payment evidence.
Example. If a certificate shows a deduction that the statement does not show, investigate the mismatch before assuming the credit is available.
Back to terms ↑Income Tax
AIS — Annual Information Statement
Information reported to the Income Tax Department about income and transactions. Review it against your own records; it is a reconciliation input rather than proof that every entry is correct.
Example. Compare reported bank interest with the bank certificate and account records. Investigate a duplicate rather than counting the same interest twice.
Back to terms ↑Investing & Retirement
CAGR — Compound annual growth rate
The constant annual rate connecting a starting value to an ending value over a stated number of years: (ending value ÷ starting value) raised to (1 ÷ years), minus 1. Additional cash flows need separate treatment.
Example. ₹1,00,000 becoming ₹1,21,000 in two years with no intervening deposits or withdrawals has a CAGR of 10%. The path between those values may be uneven.
Back to terms ↑Income Tax
HRA — House rent allowance
A salary allowance towards housing. An exemption, where the selected regime permits it, depends on actual rent, qualifying salary, location and the relevant period; receiving HRA does not make the whole amount exempt.
Example. A midyear city or salary change calls for separate period records. Keep the rent agreement, receipts and payroll details together before calculating an exemption.
Back to terms ↑GST
ITC — Input tax credit
Credit of input tax, subject to GST eligibility, documentation, time limits and restrictions. Credit eligibility, the ledger balance and permission to use credit are separate questions.
Example. A purchase invoice showing ₹1,800 GST does not by itself establish that all ₹1,800 can be claimed or used against every tax head.
Back to terms ↑Capital Gains
LTCA — Long-term capital asset
A capital asset outside the applicable short-term definition. Asset classification precedes the gain and tax calculations.
Example. In the Capital Gains Calculator, use “Identify the asset” before estimating the gain; preserve both dates and the asset category.
Back to terms ↑Capital Gains
LTCG — Long-term capital gain
A gain arising from a long-term capital asset. Different asset and transaction categories can have different tax rules.
Example. A selling price of ₹5 lakh is not automatically a ₹5 lakh gain. Identify the relevant costs and adjustments before estimating tax.
Back to terms ↑GST
LUT — Letter of Undertaking
An undertaking used by an eligible registered supplier for zero-rated supplies without payment of integrated tax. It is furnished for a financial year and is separate from a refund claim.
Example. Before an intended LUT export, keep the financial-year LUT acknowledgement with the invoice file. The acknowledgement does not itself establish export eligibility or refund entitlement.
Back to terms ↑Income Tax
Marginal relief
Relief that limits a tax jump around a specified threshold. Rebate-related relief and surcharge marginal relief have different rules.
Example. Compare a record just below the relevant threshold with one just above it while keeping the income mix fixed; inspect which relief the computation actually applies.
Back to terms ↑GST
Nil-rated supply
A supply carrying a nil GST rate. A nil rate does not make a supply zero-rated or establish export refund entitlement; exempt-supply credit consequences require separate review.
Example. A domestic sale with a verified nil rate and an export under LUT may both have no output tax, but belong in different review categories.
Back to terms ↑GST
RCM — Reverse charge mechanism
A mechanism under which the recipient pays GST for a covered supply instead of the supplier. The applicable category, parties, date and conditions determine whether it applies.
Example. A supplier invoice with no GST is a prompt to investigate; it does not by itself prove that reverse charge applies.
Back to terms ↑Capital Gains
STCA — Short-term capital asset
A capital asset within the applicable statutory short-term holding definition, including relevant exceptions.
Example. A duration alone is incomplete input: record the instrument, listing or fund facts and dates before selecting a tax category.
Back to terms ↑Capital Gains
STCG — Short-term capital gain
A gain arising from a short-term capital asset. Classification does not mean that one special rate applies to all such gains.
Example. Separate disposal proceeds from the gain, then identify whether the particular transaction belongs in a special-rate or other category.
Back to terms ↑Investing & Retirement
SWP — Systematic withdrawal plan
Scheduled withdrawals from an investment, commonly by redeeming units. Withdrawals can include your capital and do not guarantee returns or that the corpus will last.
Example. A ₹12,000 withdrawal at a unit value of ₹60 redeems 200 units before any applicable costs or taxes. At ₹50, it requires 240 units.
Back to terms ↑Investing & Retirement
XIRR — Return using dated cash flows
An annualised internal rate of return using the actual dates of contributions and receipts. It is useful for irregular cash flows; a valid calculation needs both outflows and inflows and may fail to find a solution.
Example. Record each deposit with its date, withdrawals separately and the ending portfolio value as a final inflow. A single average balance loses the timing information.
Back to terms ↑GST
Zero-rated supply
The GST category covering qualifying exports and qualifying SEZ supplies. This framework can preserve eligible credit and permit refunds subject to conditions; it is distinct from a nil GST rate.
Example. An overseas customer name on an invoice is not enough. For a service, first verify the export conditions and place of supply.
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