Tax on investments: capital gains, TDS and returns

Q1. Which statement best describes “Capital gain”?

1. This is the profit made when you sell an asset for more than its cost.
2. This is the price you paid for the asset, plus certain costs, used to work out the gain.
3. This is a profit locked in by selling, and only such profits are taxed.
4. This is the time between buying and selling an asset, which decides whether the gain is short term or long term.

Q2. Which statement best describes “Equity capital gains”?

1. This is the treatment of gains from funds investing mostly in debt, which for many such funds is taxed at the investor’s slab rate.
2. This are gains on listed shares and equity-oriented funds, taxed at rates that differ for short and long holding.
3. This means dividends are added to your income and taxed at your slab rate.
4. This is a tax charged on buying or selling listed shares and units of equity funds.