Hey @Tapastanay,
Yes, you have calculated the turnover value correctly in both the cases.
Options turnover = Absolute Profit/loss + Sales Value
When you buy- Loss is of 2500 and sale value is 0 so the turnover is 2500.
When you sell- Sales Value is of 2500 plus loss amount of 2500 is 5000.
Hi!
I would like to get a clarification on the tax implications in the following case.
Income from House Property (Rent) 60,000.00
LTCG 1,20,000.00
STCG 50,000.00
Intrady Loss 50,000
FnO Profit 70,000.00
Please.
Hey @Tapastanay,
Letās look at your Income Tax implications for the following cases:
Oh my goodness!
I have not asked for any rule book. I wanted to see the complete calculations. I know all the theories but what will be the net result while going for calculations. Since here Net income is 2.5 lac just the threshold of tax liability. Please provide a complete calculation structure.
Which ITR to be filled for equity day trading to carry forward the losses.
Hey @Double_hammer,
ITR3 needs to be filed for speculative business income (Intraday trading), and losses can only be set off against speculative business income and carried forward to four years. You can use this tool to Know which ITR form to file based on your income situation.
Hi @Tapastanay,
You can log on to Quicko, enter your income situation, and understand your tax liability 
Hey @rupeshmandal,
Following is the response to your queries:
The taxpayer needs to invest capital gains in respective assets within the stipulated time to claim capital gains exemption. However, since the stipulated time limit is long and goes beyond the due date of filing ITR. It becomes difficult to determine whether the capital gains would be taxable or not. Hence the taxpayer can park the funds in CGAS on or before the due date of filing of ITR. So taxpayer needs to open the CGAS account and park funds on or before the due date of filing of ITR.
If the amount is not invested within stipulated time then the exemption is withdrawn and it becomes taxable in that year as Capital Gains. And basic rules of Income Tax should apply on the same. Hence in our opinion taxpayers should be allowed to set-off capital gains against business losses.
Would you please clarify the following cases?
Case 1 :
If someoneās income from salary is 2,80,000.00
Loss in Trading is 40,000.00
In this case does the person need to File ITR?
Case 2 :
If his income from Salary 2,80,000.00
Loss in Trading is 20,000.00
In this case probably he needs to file ITR 3. Am I correct? Furthermore, he may be required to get audit report separately (assuming his profit less than 6% of turnover).
Would be obliged if you elaborate it little more without referring to the standard rules or Income Tax Calculatorā¦
Hi @Tapastanay,
It is mandatory to file your ITR when your income is above the basic exemption limit i.e. INR 2,50,000. It always a good practice to file ITR and report & carry forward losses.
In both cases, since the taxpayer has done Intraday and F&O trading, they will be required to file ITR 3.
If the profit is less than 6% of the turnover, tax audit is applicable.
However, in case the total income is below the basic exemption limit and turnover is below INR 1 cr, tax audit is not applicable.
Hope this helps!
Iām really thankful for your kind response. However, it is a bit confusing when net income is below basic exemption limit, then where the applicability of Rs 1cr comes from. Even your chart tells something different.
As we see in the first case total income is below the basic exemption limit, hence there is no need for ITR filing,
However, in the second case total Income is above the basic exemption limit, hence ITR 3 filing is required. Also accounts need to be audited irrespective of any limit of turnover (as it is loss i.e. Less than 6% of turnover).
Please confirm my analysis.
Also please clarify what is the reason for different slabs like 25 lakh, 1cr 2cr etc while applicability is same?
I am salaried employee . I generall fill itr 1 and after all deduction i have no tax liability to pay income tax .
But this year i have 1. Short term equity mf gain = 200 and long term equity mutual fund gain = 1786
2. Short term debt gain = 488
I already filled itr 1.
Should i fill itr 2 ? Please help
Hey @Nataraj_Mandal,
Yes, you should always report all your incomes when filing your ITR. So, if you have already filed your ITR once, you can amend your return, add your capital gains details, and file ITR 2 as a revised return.
Read more about capital gains.
It reduces the chances of getting a notice from the Income Tax Department. Especially, with the recent MoU between SEBI and CBDT for the exchange of data, ITD can catch you for not reporting your Trading transactions.
Intraday & F&O losses cannot be set off against Salary income, therefore the total income in both the cases will be above the basic exemption limit of INR 2,50,000.
Learn more about set off and carry forward of losses.
When determining Tax audit applicability, tax audit is not applicable when the total income is below the basic exemption and the turnover is below INR 1cr.
@Quicko For trading professionals (no other source of income) can you suggest rebates which could be availed if the sole source of income is trading (Equity Intraday & F&O) and the income falls with 30% tax rate?
Also for how long could the depreciation of assets such as Computers & Laptops be availed? Also is there any problem if these things are purchased every two year or so?
Please enlighten me following points as Iām getting very confused.
The very concept of Total Income seems to be very confusing to me. When salary income 2,50,000 and loss in trading 20,000 then also Total Income is to be considered as 2,50,000.(as trading loss cannot be set off with salary). Then why it is being called as Total Income that is a point.
Suppose my salary income is 2,00,000 and profit in trading is 1,00,000. Then what will be total income here? I assume it should be 2 lac +1lac = 3 lac. Then question will arise if we have to add both the incomes to calculate Total income then, why we cannot consider the same method in the above case?
If total income as mentioned in point 2 is not 3lac then what amount it should be? In this case whether the person is bound to file ITR or not?
I beg your pardon if I displease you with the repetitive questions. But, Iām honestly speaking that it is still very confusing to me to figure out the concept of considering Total income whether it is below or above the basic exemption limit.
Please help me to figure out this.
Hey @DemonSlayer,
You can claim expenses against trading income and claim deductions under Chapter VI-A.
The IT department has defined depreciation rates for asset classes, however there is no useful life defined under IT Act. You can claim the depreciation till the asset value becomes null. Buying assets frequently and claiming depreciation for the same is not an issue as long as the same are used for trading purpose.
The Total Income = Sum of all the incomes earned (Salary + HP + IFOS + CG + B&P) - Current year loss adjustment - Brought forward loss adjustment - Total Chapter VI-A Deductions.
Here one needs to keep in mind the rules of set off and carry forward of losses.
As per the Income Tax Act, trading Income which is considered as business income cannot be set off against Salary Income.
Hello,
Needed some clarity regarding Revised ITR filling for AY2019-20. As the last date is 29th nov. If I have filled ITR 4 and have a refund as I forgot to mention the 80C savings. will I get the refund and is there any penalty is this case? Appreciate your early response. Thanks,
