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calculate_tax_liability

Calculate Indian LTCG/STCG tax liability for equity or mutual fund trades with post-July 2024 rules, including exemptions and loss carryforward. Get gain classification and tax summary.

Instructions

Calculate Indian LTCG / STCG tax liability for an equity or mutual fund trade.

Applies Indian tax rules (post July 2024 Budget):

  • Listed equity / equity MF STCG (≤365 days): 20% flat (Section 111A)

  • Listed equity / equity MF LTCG (>365 days): 12.5% above ₹1.25L exemption (Section 112A)

  • Debt funds (post Apr 2023): taxed at income slab rate regardless of holding period

  • Capital losses: carried forward for 8 years

Args: buy_price: Purchase price per share/unit in INR buy_date: Date of purchase in DD-MM-YYYY format (e.g. 15-01-2023) sell_price: Selling price per share/unit in INR sell_date: Date of sale in DD-MM-YYYY format (e.g. 20-03-2024) quantity: Number of shares or units asset_type: One of: equity, mutual_fund_equity, mutual_fund_debt, debt_fund symbol: Optional stock/fund symbol for display (e.g. RELIANCE, TCS)

Returns: Formatted tax summary with holding period, gain classification, and tax liability.

Examples: calculate_tax_liability(buy_price=1200, buy_date="01-01-2023", sell_price=1500, sell_date="15-03-2024", quantity=100, symbol="RELIANCE")

Input Schema

TableJSON Schema
NameRequiredDescriptionDefault
symbolNo
buy_dateYes
quantityYes
buy_priceYes
sell_dateYes
asset_typeNoequity
sell_priceYes

Output Schema

TableJSON Schema
NameRequiredDescriptionDefault
resultYes
Behavior4/5

Does the description disclose side effects, auth requirements, rate limits, or destructive behavior?

No annotations provided, so description carries burden. It details calculation rules including capital loss carry forward, but doesn't explicitly state it has no side effects. Still sufficiently transparent.

Agents need to know what a tool does to the world before calling it. Descriptions should go beyond structured annotations to explain consequences.

Conciseness4/5

Is the description appropriately sized, front-loaded, and free of redundancy?

Well-structured with overview, rules, args, returns, examples. Front-loaded purpose. Could be slightly more concise, but each section earns its place.

Shorter descriptions cost fewer tokens and are easier for agents to parse. Every sentence should earn its place.

Completeness5/5

Given the tool's complexity, does the description cover enough for an agent to succeed on first attempt?

Complete for the tool's complexity: covers all required and optional parameters, explains return value format, includes examples. Output schema exists but description still provides adequate context.

Complex tools with many parameters or behaviors need more documentation. Simple tools need less. This dimension scales expectations accordingly.

Parameters5/5

Does the description clarify parameter syntax, constraints, interactions, or defaults beyond what the schema provides?

Schema has 0% coverage, but description includes an Args section with explanations for all parameters, including optional ones like symbol and asset_type. Provides format, default, and examples, adding significant value.

Input schemas describe structure but not intent. Descriptions should explain non-obvious parameter relationships and valid value ranges.

Purpose5/5

Does the description clearly state what the tool does and how it differs from similar tools?

Description clearly states it calculates Indian LTCG/STCG tax liability for equity/mutual fund trades, with specific tax rules. Unambiguous and distinct from sibling tools.

Agents choose between tools based on descriptions. A clear purpose with a specific verb and resource helps agents select the right tool.

Usage Guidelines4/5

Does the description explain when to use this tool, when not to, or what alternatives exist?

Explicitly indicates applicable tax rules (post July 2024 Budget) and asset types. While it doesn't list alternatives, the specialized nature makes usage clear.

Agents often have multiple tools that could apply. Explicit usage guidance like "use X instead of Y when Z" prevents misuse.

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