Compliance vs Taxation

Taxation
21

Thats completely wrong spirit dude, everyone is here to gain knowledge if you have some please spread it objectively & scientifically…
To that specific point we do take second opinion form other doctors and we are doing the same here… since its faceless open platform credibility of the content posted can only be validated with IT department sections references and proofs

That being said:
Here is my understanding:

  1. FnO has to be considered under non-speculative head ie: Business income
  2. Section 44AB(a) says for FnO specifically cause of its digital Nature: if turnover above 10cr then audit is required.(Which basically is not applicable for me cause mine is ~1L)
  3. But there are other rules Section 44AB(e) Tax audit is necessary if
    3.1 Section 44AD(4) becomes applicable AND
    3.2 Taxable income is more than basic
  4. Section 44AD(4) describes that you have to declare profit at 6% for 5 years(presumptive taxation: also called Section 44AD(1)) failure to do that and tax audit is applicable.

So combining this all together i understand I should be going with presumptive option even when i have a loss profit of 6% has to be shown on 1L turnover and pay 30% of that as tax… Thus relieving me of keeping any books of record etc for compliance.

Can some one validate the understanding… @VRV you may be right i just took time to understand the clauses for my own reference…

22

Hey @pyarlath,

In the case of F&O trading where 100% of the transactions are cashless, the turnover limit for tax-audit is ₹10Cr. If your turnover is below this limit, a tax audit will not be mandatory.

Hope this helps!

1 Like
23

what do you mean by 30 % tax ? do you have other income ?

24

Yes, other income under salary head

25

I am not CA but I think you can show salary income with FNO loss. Audit is not require.

@Jason_Castelino Does audit is applicable on salaried person ?

26

For my year 1 2020, total loss was -18k, 9k loss 9k brokerage + tax. My CA just filed as how you mentioned in Option 2 ( No need to maintain any books or other tax related docs for the next 4-6-8 whatever no of years ) and just be free

1 Like
27

Fno is treated as business income, has 0 effect if you are salaried or not.
Audit applicable as per the business turn over

28

Not applicable.

29

This helps, Ok so Option 2 it is…

But these IT people should look into this and remove this tax law for compliance of audit books etc, what if a person is experimenting with business, he shoudnt be bogged down by showing profits just to get away from compliance burden…

But it is what it is…