Rakesh N Patel (General Manager - Accounts) (42 Points)
29 July 2014My question is that even if loss in F&O Trading & also Turnover is lesser than 1 crore. it is required to do tax audit? Also for salary employee which salary income is 5 lac.
One more question Speculation or Non Speculation business income both are applicable for tax audit if turnover having more than 1 crore or loss without having turnover of 1 crore?
section 44AB tax audit is compulsory if your gross turnover is exceeding rs.1 crore. there is nothing mentioned about any loss or profit.
a person whose salary is rs 5 lakhs, where i can say that all his trading transation is based on Quantities if he is doing number of transation we can't say he is an investor, then i would be speculation or F&O. however, if i did only few transations say 10-20 transation during the year then we can say he an investor who sold investment from his portfolio.
Nikhil Kaushik
(Fellow CA)
(85435 Points)
Replied 31 July 2014
Dear Ganeshan, you need to cover the provisions of section 44AD where the F&O turnover is less than Rs 1 cr. In such cases if the profit offered is less than 8%, and total income exceed Rs 2 lakhs, tax audit shall be compulsory.
CAclubindia
