Income tax filing for derivatives trading

[hitesh]

1. Intraday or positional trading in F&O : Business income / loss

2. Intraday trading in equities : Speculative Income / Loss

3. Delivery based trading in equities : Short term (If holding is less than 12 months)

4. Delivery based trading in equities : Long term (If holding is more than 12 months)

If the volume is less, one can just maintain record in excel sheet alongwith contract/bills/ledgers from the broker.

 

[a1b1trader]

1. Intraday or positional trading in F&O : Business income / loss

2. Intraday trading in equities : Speculative Income / Loss

3. Delivery based trading in equities : Short term (If holding is less than 12 months)

4. Delivery based trading in equities : Long term (If holding is more than 12 months)

Hi Hitesh

Thanks for reply

You said holding time period of less than 12 months for short term gains for delivery based trading in equities. But how less is the question, what could be the minimum holding period to qualify short term gain.

If the volume is less, one can just maintain record in excel sheet alongwith contract/bills/ledgers from the broker.

I shall be thankful if you please post an excel sheet with the relevant columns/heading to maintain records. Please its a request.

Thanks

 

[sylar123]

How are charges (such as brokerage, STT, Transaction Tax etc) adjusted? Is it as simple as Total Profits (excluding charges) or there is some special calculation required for that also?

 

[hitesh]

Hi Hitesh

Thanks for reply

You said holding time period of less than 12 months for short term gains for delivery based trading in equities. But how less is the question, what could be the minimum holding period to qualify short term gain.



I shall be thankful if you please post an excel sheet with the relevant columns/heading to maintain records. Please its a request.

Thanks

1. Holding of equities from one day to 365 will be considered as a short term.
2. Template which I am using is attached herewith. Hope it helps.

 

[a1b1trader]

1. Holding of equities from one day to 365 will be considered as a short term.
2. Template which I am using is attached herewith. Hope it helps.

Thanks for the XL sheet. It will certainly help in maintaining account details for the securities traded.
Thanks once again for your kind help.

 

[hemant_jpr20]

My CA is very clear that Derivatives trading Gains/Losses are treated under head "Speculation". Says there is a specific ruling re. this. Also due to this Losses under Derivatives trading cannot be offset against other Business Gains. However Derivatives trading profits can be offset against other Business Losses.

Will try & hunt down the ruling.

correct. I had the same words from my CA also.