profit made from F&O - 39,214.5 INR Considering to declare as Business income non-speculative
scriptwise Turnover - 7,82,305 INR
Tradwise Turnover is 17,09,053 INR
It’s not needed as per the law as long as turnover limits aren’t breached. Only if tax audit is applicable, maintenance of books becomes mandatory.
On a optional note, it is always a good practice to maintain accounts as it helps in discipline
for freelance income limit is 50 lacs and profit should be more than 50%.
I want to file under presumptive taxation. but I have loss in FNO. so I want to know can I file RETURN with presumptive taxation for freelance income and general for FNO.
Yes, you can report your income from freelancing under the presumptive taxation scheme and the F/O profits can be reported as regular business income. You will have to file ITR- 3 in this case.
No, recommend to file ITR-3 but If you have filed last year ITR-4 in Presumptive Scheme then audit mandatory.
Let me explain some background for your reference.
Carrying Forward F&O Losses and ITR Filing:
To carry forward losses incurred in F&O trading, you must file ITR-3, accompanied by a Profit and Loss account and Balance Sheet without audit if Turnover below 10 crore.
Here’s a breakdown of key audit considerations:
Audit Requirement Based on Turnover *:
A tax audit under Section 44AB of the Income Tax Act is generally mandatory for businesses, including F&O trading, when the turnover exceeds â‚ą10 crore. (95% of the transaction is done digitally, the audit limit is 10 crore.)
Switching from Presumptive Taxation:
If you previously opted for the presumptive taxation scheme (e.g., Section 44AD) and now wish to file under the normal business income rules (with detailed P&L and Balance Sheet), a tax audit under Section 44AB mandatory.
Combined Business Operations:
When F&O trading is conducted alongside other business activities, the calculation of turnover and profit/loss becomes more complex. The specific audit requirements and tax implications will vary depending on the nature and scale of each business.
Key Considerations:
Turnover Definition in F&O: The definition of “turnover” in F&O trading differs from traditional business turnover. It generally includes the absolute sum of profits and losses.
Section 43(5): F&O trading is considered a non-speculative business activity under Section 43(5) of the Income Tax Act.
Professional Advice: Tax regulations are subject to change, and individual circumstances can significantly impact tax liabilities. Consulting a qualified tax professional is crucial for accurate compliance.