Income tax return and turnover

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MANOJ CHOUDHARY (Querist)
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24 February 2017 A Individual having Business Income, Interest and Capital gain from share trading so which ITR FORM USE FOR RETURN FILING, Is it 4S..? if yes then how calculate turnover....?

Vivek Angrish

Vivek Angrish (Expert)
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24 February 2017 First of all, since you have capital gains, you can not file return in ITR 4S. You have to file ITR 4 for that.
Second, regarding computation of capital gains in share trading.
Long term capital gain: – If equity shares are sold after 12 months holding then such gain is subject to tax exemption. However, the security must be traded an Indian stock exchange on which STT has been paid. Exemption on long-term capital gain tax is not applicable if the shares are sold on the exchange outside India. Long term capital loss from equity shares is a dead loss – it can neither be adjusted nor carried forward.

Short term capital gain: If equity shares are sold within 12 months from the date of purchase, then the short term capital gain tax of 15% is applicable irrespective of the personal tax slab (10%, 20% etc). If investor’s other income excluding short-term capital gain is less than basic exemption limit then he can take benefit of such shortfall in basic exemption limit. Any short-term capital loss from equity trading can be set off against any short-term capital gains. The important points to note here is that long-term capital gain arising on shares sold directly to a friend without routing it through Indian stock exchange are not exempted from tax as STT is not paid on such shares.

But make sure that you are trading in market as investor & not as a business.
To differentiate if you are mostly trading intra-day transaction, then it would come under business activity & will be taxed accordingly.