Filing tax on booked profit for investors

I have done a profit booking for few shares before one year completion. I am new into stock market investment. I want to know how can I declare my profit while filing ITR?

Do I need to get the documents prepared by any CA or I can right away declare the income as extra income in ITR e-filling and pay taxes on it?


Btw, do I need to get my P&L audited by CA?

An audit is required if you have a business income and if your business turnover is more than Rs 1 crore for a financial year. In case of digital transactions (equity transactions are 100% digital), this turnover limit is Rs 2 crores. For equity traders, an audit is also required as per section 44AD in cases where turnover is less than Rs.2 Crores but profits are lesser than 6% of the turnover and total income is above minimum exemption limit.

@goldb turnover = amount invested in market or inclusive of Salary?

Don’t mix Salary with Turnover.
About Tax Calculation : there are 2 ways to do it.

  1. As a Business income : declare yourself as a trader and share trading as your busines. Claim all the related expenses against the gains made by you and pay tax on the net gains according to your tax slab.
  2. As a Capital Gain (Short Term) : Since the holding period is less than 1 year, you would have to pay 15% tax on your gross gains.
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I have started investing very recently. As of now I have total turnover of 36k and profit booked was only 850 so far. The existing holdings I have are planned for long term. So I will be filing tax for 850 profit only. The profit is around 2.2% of entire turnover and turnover is less than 2 crore.

Do I need to get it audited by CA for such a small amount?

@bigbullinside @goldb

If you claim it as Capital Gains, you don’t need to worry about the audit with 36k T/O. But I am not so sure about the audit if you claim 850 as your business income. Pay 15% STCG of 128 or as business income, and pay whatever your tax slab is. It is up to you. But once you choose a path, you will not be able to change.