Please help for tax return filing

Taxation
1

This is my situation as per report downloaded from zerodha:

|Intra-day / Speculative profit|-30000.00|
|Intra-day / Speculative turnover|47567.65|
|Short-term profit|8752.65|
|Short-term turnover|258797.45|
|Long-term profit|0.00|
|Long-term turnover|0.00|

Please help me in understanding tax implications?

Whether i can carry forward losses, or offset against short term loss? Whether audit is required?

2

you can reach me at 8940000824 for your tax filing

3
  1. You can offset the Intraday Speculative loss 30K against other income like bank interest, dividends, rent e.t.c. and remaining can be carry foreword for next 4 years, if and only if (You are declaring Trading as business).
  2. You can offset the Short Term non-speculative profit of 8752.65 against F&O loss (if there is any). And pay the tax on remaining part.

  • Total turnover = 258797.45 + 47567.65 = 306365.10 which is less than 2 Cr.

  • Net profit = -30000 + 8752.65 = -21243.45 which is less than 6% of total turnover.

Yes, Audit is must in your case, if you wish to carry forward your loss.

Note : You can not offset your loss against Salary Income.

4

what is your main source of income?

5

In this case, suppose he doesn’t want to carry forward loss, can he avoid audit?

6

Yes, He can avoid audit by paying the taxes on 6% part of his total turnover. Also he have to file his return by filling I.T.R - 4

7

If this question is to me (You have replied to my comment). I would like to pass this one. Since I am not the one who is looking for advice here.

8

I have F&o and intraday loss. Gain of 180000 from short term delivery. And only income is FD interest of 130000. Should I add Fd income to short term profit for total income? And can i subtract F&O LOSS FROM it? Total turn over for all types of trades is 79 lakhs. Which ITR should I fill.? Is audit requiered? And can I also show only short term gain and pay tax to avoid audit, since audit costs more fees while tax in 180000 would be around 7000 , I think. Is it legal to avoid audit in case of FO loss and not show loss in ITR.

9

Speculative Business Income - Trading in Equity cash.
Non-Speculative Business Income - All Future & Option positions along with Investment in Equity and Mutual funds.

Note : Speculative (Intraday equity) loss can’t be offset with non-speculative (F&O) gains, but speculative gains can be offset with non-speculative losses.

You should come up with net income only after offsetting all applicable P&L.

Yes, you can offset F&O loss from Short Term Delivery and FD Interest.

I.T.R - 3

Yes, Audit is required in your case.

In order to avoid audit, you have to pay tax on 6% part of total turnover.

If you are filling return properly and paying tax as per income tax rule, it is okay.

10

I am a salaried employee…My number of trades are around 25 each for intraday and short term

11

Thanks a Ton Shravan. Cleared everything.

12

Where can we get details of profit or loss we incurred on commodity futures? I couldn’t find that anywhere in Q.zerodha.com (their back office). Want to show it under non-speculative loss.

13

Shravan, I have also read somewhere that if Audit is required one has to sign it digitally. So in my case will I need to buy a digital signature too? As we discussed I have net loss overall, now audit fee and digital signature will be too much. Please advise.

14

Yes, you need to sign it using DSC.

DSC sign device will cost around INR 1150 for 3 years. And I will recommend you to do this. You can visit E-Solutions to get your DSC. They have a cool paperless applicable process authenticated via virtual aadhar id. If you are based out of Delhi, then you can get it on same day, otherwise it will take 2 working days.

15

no audit required. call if need to file return