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F and o trading

rahulkoli (employee) (65 Points)

10 January 2022

Dear all ,

My query is Trading in Future and options should be treated as bussiness income i want to know what is nature of bussiness code in itr

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14 Replies

Dhirajlal Rambhia (SEO Sai Gr. Hosp.) (177852 Points)
Replied 10 January 2022

YES...

Other financial intermediation services n.e.c - 13018

1 Like

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rahulkoli (employee) (65 Points)
Replied 10 January 2022

Respected sir it means it is sale of service not good ?

Dhirajlal Rambhia (SEO Sai Gr. Hosp.) (177852 Points)
Replied 10 January 2022

Yes, being no delivery taken, its just calls & options.

In actual terms, there is no specified business code for the share trading...

So, this one is most suited... & is being use by almost all the traders...

2 Like

rahulkoli (employee) (65 Points)
Replied 10 January 2022

Thanks alot sir for valuable guidance

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Dhirajlal Rambhia (SEO Sai Gr. Hosp.) (177852 Points)
Replied 10 January 2022

Most Welcome ...

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CA Puja Sharma (Chartered Accountant) (5010 Points)
Replied 11 January 2022

You can also use the code: 09028 -Retail sale of other products n.e. c

2 Like

hirein lakhani (10 Points)
Replied 02 April 2022

(1) i am a full time professional intraday trader in National Stock Exchange .
(2) all source of (taxable) income is zero .
(3) share market ( business income head ) intraday turnover is less than 1 crore and the LOSS is 5 lakhs .

do audit is required if want to declare the loss and carryforward the loss ?

Kev Men (788 Points)
Replied 13 April 2022

@ hirein lakhani

Yes, tax audit is required. On combined reading of Sec 44AB(e), sec 44AD(4) and sec 44AD(1), tax audit will be applicable if the business profit is less than 8% (or 6% if all gross receipts/turnover is other than cash) of the gross receipts/turnover of the business. There is no differenciation of 'speculative business' and normal business as per the above sections. Intraday turnover is 'speculative business'.

In your case the intraday loss is 5 lakhs which means the net profit is less than 6% or 8% of the turnover. You will need to do tax audit to carry forward the loss. If you don't want to do tax audit, you will need to forgo the loss and show minimum 8% net profit u/s 44AD. This is my view.

hirein lakhani (10 Points)
Replied 13 April 2022

BUT .

my business profession is intraday share market trading .

=====

(1) total income is zero

(2) all the transaction trades are 100% bank online

(3) turnover is less than 1 crore

(4) loss is around 4 lakhs .

===

i have heard that since , the gross total income is zero i.e. less than 2.50 lakhs ; in the above case ; audit is not required , and i can show declare and carryforward the loss without the audit !

am i right ?

or am i missing something ?

pls kindly enlighten ..

hirein lakhani (10 Points)
Replied 01 July 2022

do i need audit ; even though there is nil income ?

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hirein lakhani (10 Points)
Replied 01 July 2022

do i need audit ; even though there is nil income ?

hirein lakhani (10 Points)
Replied 01 July 2022

Originally posted by : Kev Men
	@ hirein lakhani Yes, tax audit is required. On combined reading of Sec 44AB(e), sec 44AD(4) and sec 44AD(1), tax audit will be applicable if the business profit is less than 8% (or 6% if all gross receipts/turnover is other than cash) of the gross receipts/turnover of the business. There is no differenciation of 'speculative business' and normal business as per the above sections. Intraday turnover is 'speculative business'. In your case the intraday loss is 5 lakhs which means the net profit is less than 6% or 8% of the turnover. You will need to do tax audit to carry forward the loss. If you don't want to do tax audit, you will need to forgo the loss and show minimum 8% net profit u/s 44AD. This is my view.

do i need audit ; although the income is NIL ?

Ramkumar (superviser) (58 Points)
Replied 22 July 2022

My net income is below taxable limit and I have incurred a F&O trading loss of 1.3 lac for FY 2021-2022. My turn over is 75 lac approximately. I understand that tax audit is not applicable for me and I can carry forward this loss by filing ITR 3. While filing ITR 3 , am I liable for maintaining book of accounts u/s 44AA. …please reply..