When shares are transferred from one DP to another, the old DP classifies the transfer as a sell transaction, which will be treated as capital gains during tax filing. How can this issue be addressed while filing taxes?
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A DP-to-DP transfer between your own demat accounts is not a taxable sale because beneficial ownership remains unchanged. You should exclude the transaction from Schedule CG on your ITR, submit feedback on your AIS if the transfer is flagged as a sale, manually update your acquisition cost with the new DP, and retain all DP transaction statements for documentation.