There are multiple blogs and youtube videos explaining how to calculate turnover. But what next?
No one explained clearly how much tax applicable based on turnover.
Can someone give an example of turnover to tax
Hey @Jugaad_trader,
The turnover is used to determine your tax audit applicability.
As far as the tax liability is concerned, you need to pay tax on the profits that you make. In the case of F/O trading, the profits are classified as business income and are taxed as per your applicable slab rate.
Hope this helps!
Specifically, If I want to go for presumptive taxation.
My Turnover is say 40 lakh and profit is 5 lakh, What will my tax liability be based on?
6% of 40L (Turnover) as per Section 44AD?
Or
50% of profit taxable at my tax slab - ie (50% of 5L) x tax slab rate
?
Hey @Jugaad_trader,
Section 44AD is specifically for small businesses or professionals who are unable to maintain books of accounts. In the case of trading, most reports are readily available and hence, it is better to report as regular business income. In that case, you’ll have to pay taxes on the profits, i.e. ₹5L as per the slab rate.
In case of the presumptive taxation scheme for business, you can report 6% of your turnover as profits and pay tax as per slab rate on the same.
Do we have to file ITR if we have small loss in FNO. There isn’t any other income source ?
Hey @bharat1080,
Filing an ITR is mandatory when your income exceeds ₹2.5L for the financial year.
However, if you have losses, filing an ITR is beneficial as you can carry forward the losses and those can be set off against the profits that you make in the subsequent years.