GUIDANCE NOTE ON TAX
AUDIT UNDER SECTION 44AB
OF THE INCOME-TAX ACT, 1961 by ICAI states
5.12
(b) Derivatives, futures and options:
The turnover in such types of transactions is
to be determined as follows:
(i) The total of favourable and unfavourable differences shall be
taken as turnover.
(ii) Premium received on sale of options is also to be included in
turnover.
(iii) In respect of any reverse trades entered, the difference thereon,
should also form part of the turnover.
So, in terms of Options what would be the turnover,
Suppose I sold Nifty PE @ 100, and bought back @ 80, difference is 20Rs (profit); Now do I have to add 100 to turnover, or the net difference of 20 rs will be turnover?
AUDIT UNDER SECTION 44AB
OF THE INCOME-TAX ACT, 1961 by ICAI states
5.12
(b) Derivatives, futures and options:
The turnover in such types of transactions is
to be determined as follows:
(i) The total of favourable and unfavourable differences shall be
taken as turnover.
(ii) Premium received on sale of options is also to be included in
turnover.
(iii) In respect of any reverse trades entered, the difference thereon,
should also form part of the turnover.
So, in terms of Options what would be the turnover,
Suppose I sold Nifty PE @ 100, and bought back @ 80, difference is 20Rs (profit); Now do I have to add 100 to turnover, or the net difference of 20 rs will be turnover?