Fire your tax related queries and i would get it solved!!!

[Smart_trade]

i didnt understand purpose of this thread can anyone explain about this thread...

The purpose of this thread is to discuss various provisions of Income Tax as applicable to traders. Taxation is very important today for anyone. This thread helps us to know what type of IT Return form to be used ,books to be maintained, audit provisions etc. All that of course if one is paying taxes.

Smart_trade

 

[Gaur_Krishna]

Smart_Trade da,

Please give some time and answer these queries plz:

Here are some Income TAX queries. As filing Tax Returns date comes very close, need this info, thanks in advance:

1. For a salaried person with FNO trades and some equity delivery and equity intraday (which will be speculative income), should one fill ITR-4 or ITR-4S or anything else?

2. Can the profit or loss calculated in a very simple way such as during the FY 12-13 : Total money Credited to trading account during 01Apr2012 to 31Mar2013) - MINUS - (Balance on 31st March 2013)
OR do we have to note each trade and give detailed Profit/loss statement and then arrive at this figure?

3. If one has purchased Laptop & internet, can he show these as business expenses (loss)?

4. What about fees paid to some TA course and subscriptions for TIPS provider services : Can these be considered as business expense (loss)?

5. Account opening fees and annual DMat Charges: Can they be considered as business loss?

6. in ITR-4, do we need to fill in all the trade details or just profit/loss figure and keep the details for any query etc?

Regards,
Gaur_Krishna

The purpose of this thread is to discuss various provisions of Income Tax as applicable to traders. Taxation is very important today for anyone. This thread helps us to know what type of IT Return form to be used ,books to be maintained, audit provisions etc. All that of course if one is paying taxes.

Smart_trade

 

[umesh12]

My query is:

I started Nifty trading last year. My total turnover for the year 2012-13 is 9.86 lakhs. And I made a loss of 5,000 from the trading. I do not have any other income except saving account interest, which is 1000.

Now do I have to file ITR compulsorily. (I do not intend to carry forward my this loss to next year). If yes then which ITR form (ITR 4 or ITR 4S) I have to fill and do I have to get my accounts audited.

Further, can I declare a profit of more than 8% on my trading turnover. As in that case, not only, my total income will be about 80,000, (which will be less than taxable limit of 2 lakhs and hence, I need not file IT return compulsorily,) but also, I do not need to get my accounts audited as well.

Thanks

 

[ritesh.bafna88]

My query is:

I started Nifty trading last year. My total turnover for the year 2012-13 is 9.86 lakhs. And I made a loss of 5,000 from the trading. I do not have any other income except saving account interest, which is 1000.

Now do I have to file ITR compulsorily. (I do not intend to carry forward my this loss to next year). If yes then which ITR form (ITR 4 or ITR 4S) I have to fill and do I have to get my accounts audited.

Further, can I declare a profit of more than 8% on my trading turnover. As in that case, not only, my total income will be about 80,000, (which will be less than taxable limit of 2 lakhs and hence, I need not file IT return compulsorily,) but also, I do not need to get my accounts audited as well.

Thanks

dear umesh your last line is spot on.

you dont need to file your return and even if you choose to then you dont need to get them audited.

simply show 8% profit and your interest income and file itr 4S

also the interest income is from saving bank account then the same is deductible under section 80TTA till the limit of Rs10000.

Regards
CA. Ritesh Bafna

 

[stockmaverick]

Section 44AD is applicable only for those who do not wish to maintain account books.
If you will file return under the provisions of section 44AD (Presumptive Profits) and show profits less then 8% of the turnover, then you are bound to get a notice under section 139 (9) as this section is not applicable on you.

Other members may like to comment

Could you please clarify this further. When would an F&O trader file return under the provisions of section 44AD? For someone having a salary and F&O trading income, does your explanation mean that filing under 44AD is not applicable and hence auditing is not required?

Thanks,
Nitin

 

[Gaur_Krishna]

@Ritesh Bafna,

Can you comment on these queries please:

Regards,
Gaur_Krishna

Smart_Trade da,

Please give some time and answer these queries plz:

Here are some Income TAX queries. As filing Tax Returns date comes very close, need this info, thanks in advance:

1. For a salaried person with FNO trades and some equity delivery and equity intraday (which will be speculative income), should one fill ITR-4 or ITR-4S or anything else?

2. Can the profit or loss calculated in a very simple way such as during the FY 12-13 : Total money Credited to trading account during 01Apr2012 to 31Mar2013) - MINUS - (Balance on 31st March 2013)
OR do we have to note each trade and give detailed Profit/loss statement and then arrive at this figure?

3. If one has purchased Laptop & internet, can he show these as business expenses (loss)?

4. What about fees paid to some TA course and subscriptions for TIPS provider services : Can these be considered as business expense (loss)?

5. Account opening fees and annual DMat Charges: Can they be considered as business loss?

6. in ITR-4, do we need to fill in all the trade details or just profit/loss figure and keep the details for any query etc?

Regards,
Gaur_Krishna

 

[ritesh.bafna88]

Smart_Trade da,

Please give some time and answer these queries plz:

Here are some Income TAX queries. As filing Tax Returns date comes very close, need this info, thanks in advance:

1. For a salaried person with FNO trades and some equity delivery and equity intraday (which will be speculative income), should one fill ITR-4 or ITR-4S or anything else?

2. Can the profit or loss calculated in a very simple way such as during the FY 12-13 : Total money Credited to trading account during 01Apr2012 to 31Mar2013) - MINUS - (Balance on 31st March 2013)
OR do we have to note each trade and give detailed Profit/loss statement and then arrive at this figure?

3. If one has purchased Laptop & internet, can he show these as business expenses (loss)?

4. What about fees paid to some TA course and subscriptions for TIPS provider services : Can these be considered as business expense (loss)?

5. Account opening fees and annual DMat Charges: Can they be considered as business loss?

6. in ITR-4, do we need to fill in all the trade details or just profit/loss figure and keep the details for any query etc?

Regards,
Gaur_Krishna

hello,

1. you need to file ITR 4.

2. no this is wrong way to calculate.

FNO is considered as normal business hence first the proper turnover need to be calculated and then the profit figure needs to be arrived that is either flat 8% or more and if you want to claim less then 8% then audit is required.

Equity intraday is speculative business not covered by 8% presumptive income hence again the proper profit figure is to arrived.

3., 4., 5. all such losses can be claimed from your FNO business income only if you want to get the accounts audited. if showing flat 8% percent then the same are not available as the section assumes that expenses are already provided for.

6. in itr 4 you can show your transactions under no accounts case where you will have to disclose only some specific details.

regards

CA. Ritesh Bafna

 

[shravank30]

@ritesh.bafna88
If I am filing return under Presumptive income in ITR 4 for my FNO Trades, can I separately show my STCG profit as separate entries, ( not connected to the FNO and claim below taxable limit income)

i.e. 1 lakh turnover in FNO 8,000 profit
STCG -30 lakhs sale price, 29.50 lakhs purchase cost 50,000 profit
Total profit 58,000

Am I correct in filing this return ?

 

[ritesh.bafna88]

@ritesh.bafna88
If I am filing return under Presumptive income in ITR 4 for my FNO Trades, can I separately show my STCG profit as separate entries, ( not connected to the FNO and claim below taxable limit income)

i.e. 1 lakh turnover in FNO 8,000 profit
STCG -30 lakhs sale price, 29.50 lakhs purchase cost 50,000 profit
Total profit 58,000

Am I correct in filing this return ?

Hello,

Yes u r filling return correctly.

Regards,
CA Ritesh Bafna

 

[Gaur_Krishna]

@ Ritesh Bhai,

How much CA should charge for computing taxes and e-filing ITR4 in this case? I came across SBI initiative and CAs charging around 250/- etc

Regards,
Gaur_Krishna

hello,

1. you need to file ITR 4.

2. no this is wrong way to calculate.

FNO is considered as normal business hence first the proper turnover need to be calculated and then the profit figure needs to be arrived that is either flat 8% or more and if you want to claim less then 8% then audit is required.

Equity intraday is speculative business not covered by 8% presumptive income hence again the proper profit figure is to arrived.

3., 4., 5. all such losses can be claimed from your FNO business income only if you want to get the accounts audited. if showing flat 8% percent then the same are not available as the section assumes that expenses are already provided for.

6. in itr 4 you can show your transactions under no accounts case where you will have to disclose only some specific details.

regards

CA. Ritesh Bafna