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

Are you able to understand the replies and act accordingly to this thread ??

  • Yes, able to understand BUT NOT able to take suggested course

    Votes: 0 0.0%
  • Somewhat able to take desicions, BUT seek professional help in my area

    Votes: 0 0.0%
  • Find it tough to understand the replies hence always seek other professional help

    Votes: 0 0.0%
  • Not able to understand any of the replies !!!

    Votes: 0 0.0%

  • Total voters
    4
  • Poll closed .

nac

Well-Known Member
Hey a small doubt.
In ITR3 to arrive capital (Part A: BS) should I add exempt income (PPF) in profit and loss account and remove the same in profit and loss account (Part A: P&L) and show it in Shedule EI?
 

TracerBullet

Well-Known Member
see the trading account. The sell side data has been shown correctly. But buy side is wrong.
From what little i understood, they have kept the negative turnover and trade related costs excluding STT/CTT in "8.) Purchases."
Later in PnL they added stt/ctt in 44.ix "Any other rate, tax, duty or cess including STT and CTT".
Final Numbers seemed ok, net after other expenses at 12,90,279 which matches data in Test ITR3 Duplicate "Net Profit As per Profit & Loss Statement"

What is missing ?

-------------
What did seem wrong was that "Are you liable to maintain accounts as per section 44AA? (Select) " was set to "No" with turnover at 70 Lakhs
-------------

Another question - Intraday equity has to be shown as speculative business.

Years ago, i had copied in my notes this line from some source - "Change from 2014-15 FY - Amendment to section 73 - If you declare trading as a business, the speculative profit/losses can be considered as business profit/losses "
But i am unable to find anything to verify this. Just looking to confirm whether there is an option to put all trading pnl into one heading without marking Equity intraday as speculative. Does not make any difference to me but just trying to understand.

Thanks !
 
Last edited:

TracerBullet

Well-Known Member
Hey a small doubt.
In ITR3 to arrive capital (Part A: BS) should I add exempt income (PPF) in profit and loss account and remove the same in profit and loss account (Part A: P&L) and show it in Shedule EI?
I think personal investments do not have to be shown in business sections. Zerodha sample has all investments, and they probably treat all of it as part of business but there are many replies in caclub saying that its not necessary. For example, i wont show my investments and esp long term stocks/mf in balance sheet - atleast not until i sell them and move money to trading.

Anyway, better wait for canikhil's reply ..
 

nac

Well-Known Member
I think personal investments do not have to be shown in business sections. Zerodha sample has all investments, and they probably treat all of it as part of business but there are many replies in caclub saying that its not necessary. For example, i wont show my investments and esp long term stocks/mf in balance sheet - atleast not until i sell them and move money to trading.

Anyway, better wait for canikhil's reply ..
My assumption up until now was that we don't need to include exempt income in Balance sheet/profit and loss account. But when I prepared P&L and balance sheet, it's not tallying. I am getting asset side higher (that exempt income seems to be the difference here).

So just to arrive capital I am including my exempt income and which increase my net income and add it to capital and show that number in Part A: BS. But when I prepare P&L, I don't have to show exempt income else my business net income increases. Just show that exempt income in Schedule EI. I googled for days, couldn't find a solution. This seems to be the right option, though I am not sure. So I am here asking. Yeah, waiting for his reply.
 

canikhil

Well-Known Member
From what little i understood, they have kept the negative turnover and trade related costs excluding STT/CTT in "8.) Purchases."
Later in PnL they added stt/ctt in 44.ix "Any other rate, tax, duty or cess including STT and CTT".
Final Numbers seemed ok, net after other expenses at 12,90,279 which matches data in Test ITR3 Duplicate "Net Profit As per Profit & Loss Statement"

What is missing ?

-------------
What did seem wrong was that "Are you liable to maintain accounts as per section 44AA? (Select) " was set to "No" with turnover at 70 Lakhs
-------------

Another question - Intraday equity has to be shown as speculative business.

Years ago, i had copied in my notes this line from some source - "Change from 2014-15 FY - Amendment to section 73 - If you declare trading as a business, the speculative profit/losses can be considered as business profit/losses "
But i am unable to find anything to verify this. Just looking to confirm whether there is an option to put all trading pnl into one heading without marking Equity intraday as speculative. Does not make any difference to me but just trying to understand.

Thanks !
Purchases data has to be shown in the manner similar to sell side data.
Accounts maintenance has to be yes.

With regards to intra-day profits, for equity based transactions, it has to be shown as speculative. Section 73 does not determine whether a transaction is speculative or not. For that you need to rely on section 43.
 

canikhil

Well-Known Member
My assumption up until now was that we don't need to include exempt income in Balance sheet/profit and loss account. But when I prepared P&L and balance sheet, it's not tallying. I am getting asset side higher (that exempt income seems to be the difference here).

So just to arrive capital I am including my exempt income and which increase my net income and add it to capital and show that number in Part A: BS. But when I prepare P&L, I don't have to show exempt income else my business net income increases. Just show that exempt income in Schedule EI. I googled for days, couldn't find a solution. This seems to be the right option, though I am not sure. So I am here asking. Yeah, waiting for his reply.
you can leave exempt income out of the balance sheet. Ideally, balance sheet and P&L should be restricted to business activities only. Unless and until you are classifying shares held as inventory, there is no need to include dividend income in P&L and consequently in Balancesheet.
 

nac

Well-Known Member
you can leave exempt income out of the balance sheet. Ideally, balance sheet and P&L should be restricted to business activities only. Unless and until you are classifying shares held as inventory, there is no need to include dividend income in P&L and consequently in Balancesheet.
Thank you.
But what do I do to tally the balance sheet. My asset side is higher than liabilities side if I didn't include that in my captial. The money I withdrawn from PPF is used for trading.
 

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