Tax audit applicable?

hi…myself shanmukh… I have salary income, arrears from salary, LTCG &STCG. I have traded in FnO and intraday prematurely… My intraday turnover is 600 and profit is +1/-(without expenses)…My options turn over is 58000 and loss of -15000/-(without expenses)… Which ITR i need to file?.. i think ITR 3 suits me based on readings from some QnA…Tax Audit is necessary in my case? a lot of confusion in that…kindly clarify me…thank you

@quicko please respond

Hi @Learn4living ,

If you have F&O/Intraday Income/Losses then ITR 3 is to be filed as income/losses from F&O/Intraday are considered as business income/losses.

In your case, ITR 3 would be applicable.

As regards tax audit, it is applicable in your case as your F&O/Intraday details are as follows:

  1. Turnover is below Rs 2 crores &
  2. Profits are less than 6% of turnover (losses in your case) &
  3. Income above the basic exemption limit of Rs 250,000.

You may refer the below guide for detailed explanation of Tax Audit applicability.

Hope it helps!

Hi Quicko,

Do you provide audit services in your ITR3 package? What are the usual charges?

Hi @lionheart, Quicko is an online tax filing platform. However, when our customers have audit requirements, we connect them with Chartered Accountants who could conduct tax audits if you want.

You can check out this link for any tax filing requirements - CA Assisted ITR filing | Salary, HP, Capital Gains, Business | Quicko

Thanks. @Quicko

Any tentative date on ITR3 filing opening?

Is tax audit mandatory if I have incurred losses (after adjusting expenses) in my business (non-trading) while filing ITR?

Tax audit is applicaple only when you want to show loss. If you want to show around 15% profit of 58000 which is Rs. 8700, and willing to pay tax on Rs. 8700 profit that you will show, then audit is not applicable.

If you are in 30% tax bracket, you will only pay Rs. 2610. The amount you will save on Audit fees should be more than the tax you would pay on profit that doesn’t exist.

Decide for yourself. What will be better. To show loss or to show profit even when you incurred loss? Since it’s a small amount, you can easily show profit in my opinion.

Disclaimer - I am not a CA or financial professional.

Minimum profit to be shown is 6 percent of turnover if you want to avoid tax audit.
In the following year the loss of the current year can be set off against profit of the following year. So indirectly you are saving tax there as well.
But in this case not opting for tax audit would be wise since the loss amount is small.

tq for the answer…i am also thinking to skip the tax audit as the loss is less…btw in the itr3 portal it is not allowing us to enter negative data under profits from business income in no books case…You got any solution for that let me know…

You are missing the point bro. You have to show positive data, not negative data.

Hi @lionheart, we are still awaiting the APIs required for e-filing. We are expecting it to be released by ITD in a week.

Also, the ITD has a meet with Infosys CEO yesterday to discuss the glitches and delay in ITR facilities and we are excepting this to expedite the process. Here is the outcome of yesterday’s meet.