Tax Planning: Traders in derivative Segment

General
41

This is business loss.

But why would you want to incur losses just to set off your gains.
You have made 10 lakhs profit and just to save tax you wanna have 10 lakhs ?
I don’t understand the objective.
If you wanna start a business then the objective can’t be to just set off losses.
This may even lead to you to losing in Fno too. And now what? Earn profit in tea business? :face_with_peeking_eye:

No doubt you can set off this loss. But what’s the objective of all this? :grimacing::grimacing::grimacing:

The discussion started with converting hobby to business to save tax. How is selling tea a hobby?:face_with_hand_over_mouth:

42

Thank you. :slight_smile:

In my view - The objective is to have it both ways - reduce tax burden and give a trial run to your business ideas. I am not saying I will certainly have losses, but it is good to know that you are covered on behalf of FnO income if there are losses in new business. As @viswaram said it from where this discussion started -

And I can ask the same question other way round - What is the objective of having money - if you are not going to use it?

Note: Tea Business - is just an example. But if you are at the right place and time - its addictive and - it can make millions. Anyhow, I am choosing to ignore all your lovely emoticons.

And thank you indeed for clarifying this. Cheers!

1 Like
43

The way I see it, if you have an idea your FNO income should play no role in deciding whether to implement it or not. If it fails you lose the entire amount in an attempt to save 30 percent tax.
Anyways, you must be having some other good reason for this, and just like our earlier disagreement, we have one here too. :+1:

In no way I meant to mock you or something. I use them because sometimes people find me too serious for the way I text. I need to show that I am saying it with a calmer voice. :blush:
A better choice next time, may be.

44

Just to be clear - the idea of starting a business is not to make loss, its to make profits.

In the unfortunate event a business becomes a loss - will the gains in other business nullify the tax burden was my query.

Also static expenses, overheads can be deducted right?

45

@Jason_Castelino
Dear Sir,
After reviewing posts in this topic, please guide for final outcome which can be followed for covered call setup or so called selling PE.

Lets say Nifty spot 24500, selling 24000 PE for premium till it spot gets to 24k or more deep 23500 , we exit PE in loss. Post we buy bees or long future with higher strikes selling.

Is it good one.

46

Yeahhh. Something that I do. But if I want to enter at 24k, I would start by selling 24200pe weekly first, because I know I can move to 24k monthly quickly without losing premium.