Tax Filing | Online trades

p_haolader · #1 7th February 2007, 04:14 AM

Hi,

I hope everyone in this forum has reaped benefits of the bull run, but alas the time for taxes has come. I trade through ICICIDirect and have made decent profits in the current financial year. I have a few questions regrading taxation.

1. How much is the short term tax on equity (sold within an year) - 10% ?
2. What documents do i submit as proof of my purchase,sale and profit - Prints of digital contract notes are ok ?
3. Can I balance trade losses against my profits. Can i include day trade losses.
4 What about STT. Can i remove this from my net tax payable.

Whats the best idea for tax filing, get a consultant or do it myself. I have a job and my company gives some form showing all my income form salary.

Suggestions and comments please.
- Partha

PS: Sorry if i posted this in the wrong forum.

rjs · #2 7th February 2007, 07:10 PM

1.Short term tax on equity is 10%
2.No docs required
3.yes u can set off short term losses against short term gains. Day trades are short term trades.
4. STT cannot be deducted from profits.

ONE LAST IMPORTANT THING: if u have traded in F&O segment or margin segment you will be treated as trader and you will be liable to 30% tax on your total profits.

tndas · #3 7th February 2007, 08:01 PM

Hi...everybody

this is my first post. I would like to get some information about online trading. Which is the best portal for NRIs. Especially interested to invest thru online for IPOs and IFO. Kindly advise.

please excuse me, if i posted in wrong forum

T.N. Das

diosys · #4 7th February 2007, 11:10 PM

RJS is correct in stating that you might land up in business income rather than short term capital gain...

hometypist · #5 7th February 2007, 11:21 PM

This information is very useful to all new investors like us. Could you also please let us know the following:

1. If the profit is within 1.25 then should I even fill the income tax forms or not.
2. Which form will be applicable to short term traders.
3. Since the PAN became mandatory only recently, what about the previous years profit / loss. Should it also be totaled to the current year profit and start.

Would appreciate your reply

Quote:

Originally Posted by rjs

1.Short term tax on equity is 10%
2.No docs required
3.yes u can set off short term losses against short term gains. Day trades are short term trades.
4. STT cannot be deducted from profits.

ONE LAST IMPORTANT THING: if u have traded in F&O segment or margin segment you will be treated as trader and you will be liable to 30% tax on your total profits.

birjubanarasi · #6 8th February 2007, 10:50 AM

@rjs
Nice info dear...but need some more clarification.
*What is STT?

I know only two category of shares (from the point of view of tax)
1) All the shares which one holds for at least one year, are not liable for tax deductions. Right?
2) All the shares which one sells off within an year will fall under tax deduction.

I think day trading stocks will automatically fall under category 2.

Please advise.

Thanks,
Birjubanarasi

bangerabs · #7 8th February 2007, 01:33 PM

Recently, I contacted one person who is not qualified consultant but has fair knowledge of I.Tax. When I tried to contact him on phone, he said he would visit my residence. After consulation for about 1/2 hr. he asked for his fees. It was Rs.500/-. His argument was that Doctor's charge consultation fees. Is he right?. Whether right or wrong, I am looking for alternative person who is reasonable.

p_haolader · #8 8th February 2007, 10:44 PM

Thanks every one for your responses. I would like to add one more question.

When i calculate taxes, do we include or remove brokerage.
For example I bought for 100000 + 1000 brokerage, sold for 200000 + 2000 brokerage.

My Taxable profit is 200000-100000 = 100000 or 200000-100000 - 1000 - 2000 = 97000.

rjs · #9 9th February 2007, 02:56 PM

Quote:

Originally Posted by p_haolader

Thanks every one for your responses. I would like to add one more question.

When i calculate taxes, do we include or remove brokerage.
For example I bought for 100000 + 1000 brokerage, sold for 200000 + 2000 brokerage.

My Taxable profit is 200000-100000 = 100000 or 200000-100000 - 1000 - 2000 = 97000.

200000-100000-1000-2000 = 97000 is ur taxable profit.

rjs · #10 9th February 2007, 03:06 PM

Quote:

Originally Posted by birjubanarasi

@rjs
Nice info dear...but need some more clarification.
*What is STT?

I know only two category of shares (from the point of view of tax)
1) All the shares which one holds for at least one year, are not liable for tax deductions. Right?
2) All the shares which one sells off within an year will fall under tax deduction.

I think day trading stocks will automatically fall under category 2.

Please advise.

Thanks,
Birjubanarasi

STT is securities transaction tax. Once you do a trade, this tax is automatically deducted by the stock exchange. So you dont have to bother about that. But you cannot deduct it as cost, while calculating your taxable profits. A trader can deduct STT as his cost while calculating Taxable profits but his profits are liable to 30% tax.

Long term capital gains = Sale of shares after 1year = No tax
Short term capital gains = Sale of shares within 1 year of purchase = 10% tax

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