Ohhh then we have to take delivery by making cash payment. Thanks for the Info.
Sir this is dangerous situation if call is sold n short squeeze happen line in GameStop amc you sold call for 60 n stock appears to 120 you on in big trouble.
For put shorted it still decent as you know how much you will pay
I think as LRS only applies to individuals and not companies and firms maybe setting up a company in india and then trading us stocks could do the trick.(maybe add a US subsidiary for extra protection).
NSE IFSC to introduce trading in select US stocks
NSE IFSC will be the first to allow Indian retail Investors to transact in US stocks. “The offering will be in the form of unsponsored depository receipts,” it said.
nice lets see if they allow limited risk trading strategy on this exchange
https://m.rbi.org.in//Scripts/BS_PressReleaseDisplay.aspx?prid=52026
I came across this and what I am able to comprehend is that this makes derivatives trading abroad and forex trading legal
With due respect, I think your answer doesn’t make sense
In this draft RBI also mentioned that LRS for gambling is illegal whereas this thing was already written previously; so it could be that they are it mentioning about the illegal contraventions
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Hi
Would you mind reading this link
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i am also searching for this answer from the last months, thanks for sharing. By the way i heard that people who live in Singapore can easily trade derivatives market outside there country. which is margin account. while here at India we have different rules and regulations
Hello @namitjain2890 @siva-reddy (also wanted to mention Ragavendran_V & TraderVenk but it seems new users can make only 2 mentions)
What if I am an Indian citizen and resident who owns a consulting firm in the US and having a global income. Can I use that global income received in the US to open a margin account with a US broker on a US firm’s name and trade leveraged products?
Now here I won’t be remitting any money outside India so, clearly respecting FEMA and LRS and it is not causing any violations.
As it is a consulting company and we had existing clients our investment in that company was $0, which has been documented in the Operating Agreement of LLC. Ie. Initially also while doing the entire set up I personally have not remitted any money outside India. My NRI contacts in the US took care of it and I reimbursed them here in Indian accounts. So to sum it up zero money is remitted out of India since beginning.
Your inputs will be appreciated.
Guess you should consult some professional on this, we can get info on Indian markets but if you are investing in US better you consult who knows those markets clearly.
You are not violating FEMA. You can go ahead and trade leveraged instruments using firm’ account and its profits.
I am in the same situation. Planning to return to India and will become resident.
Can you please share how you are handling the taxes and avoiding double taxation? Any CA, lawyer you recommend.
How do we report F&O gains or losses earned in the USA?
My understanding is we need to file ITR3 because F&O gain is defined as business income in India ( sounds strange but it is what it is ). In the USA F&O gains are considered as Capital gain just like gains in the equities.
I talked to more than 10 CAs so far for tax audit. They would tell you to provide numbers in Indian rupees but converting dollar to rupees would not be their headache. My gain is only 11000 rupees. That may be the reason CA is not interested to hear me out? I don’t know.
I was told by one CA (just one out of 10 ) that I can show this amount in the Capital Gain schedule. No need to declare it as business amount.
Anyone here shed more light on this please?
Tax audit requirements is defined according to turnover in Indian markets (F&O). Not sure whether it is applicable for turnover in US Futures and options.
You may consult Galactic advisory. Their charges are quite high though.
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Depends if you are a resident or not. if you are, then the legality of the trades may be in question which is probably why the CAs are not willing to take this up. On the other hand, if you are a non-resident, then you can simply file you returns in the jurisdiction of your tax residence.
Which broker do you use and do they still allow options trading.
I don’t fall under LRS as my money is foreign earned and in foreign accounts, but most brokers I enquired don’t allow options for Indian residents.
I am mainly looking to sell cash secured puts.
Were you able to open a margin account with US broker? I am in same situation as you but can’t find broker who will allow margin trading. All of capital was earned in US through job. So I won’t be using LRS.