Which of the following is considered as a capital asset under the Income Tax Act

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Question: Which of the following is considered as a capital asset under the Income Tax Act?

Options:

Correct Answer: Residential house

Solution:

A residential house is considered a capital asset under the Income Tax Act.

Which of the following is considered as a capital asset under the Income Tax Act?

Which of the following is considered as a capital asset under the Income Tax Act?

Step 1: Understand what a capital asset is. A capital asset is something you own that can increase in value over time.
Step 2: Know that the Income Tax Act defines certain items as capital assets for tax purposes.
Step 3: Identify examples of capital assets. Common examples include real estate, stocks, and bonds.
Step 4: Recognize that a residential house is a type of real estate.
Step 5: Conclude that since a residential house is a type of real estate, it is considered a capital asset under the Income Tax Act.

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