Audit required for intraday trading loss

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A salaried employee with significant intraday trading losses is seeking advice on whether a tax audit is mandatory for filing their income tax return. While generally not required for turnover below ₹3 Crore unless opting for presumptive taxation, specific conditions regarding past profit declarations and current losses might trigger an audit requirement. The discussion clarifies that if presumptive taxation hasn't been used in the last five years, filing with a speculative loss without an audit is likely permissible, though maintaining books of account is advised.

Rajiv

Rajiv (Querist)
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09 September 2025 Dear Sir,

I am a salaried employee having annual salary income of 7 Lac. I had incurred loss of INR 8.50 Lakhs in intraday trading of stocks in last FY 2024-25. My absolute turnover was 10.50 Lacs.

It there audit required for filing my income tax return. If yes, which section will be applicable on my ITR.

Please suggest

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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09 September 2025 No. For absolute turnover od Rs. 10.50 lakhs or even for loss declaration Tax audit not applicable; but you need to maintain books of account.

Rajiv

Rajiv (Querist)
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09 September 2025 Dear Sir,

Many thanks for the reply but please check below points which itself saying that audit is required.

Whether Tax Audit Is Applicable For Intraday Trading?
If you opt for Presumptive Taxation
Tax audit is not applicable if
Your Intraday Trading Turnover is up to ₹3 Crore (and)
If you have reporting profits of at least 6% of Trading Turnover
Tax Audit is applicable if
If you have incurred a loss or you are reporting profit lesser than 6% of Trading Turnover (and )
Your total income is more than Basic Exemption Limit.

Please advise.

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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09 September 2025 The condition applies if you had ever declared the profit from intraday trading under presumptive assessment in any of last FIVE years. And breaking the condition of not declaring minimum 6% profit for next five years.

Rajiv

Rajiv (Querist)
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10 September 2025 Dear Sir,

Thanks for your guidance. If I file my ITR by showing speculative loss figure without audit, is there any chances of notice from income tax department for non compliance of audit and I have to comply with the Audit. In that case, will my carry forward loss be considered. Is there any penalty will be charged for non compliance ?

Please advise.

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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10 September 2025 As per my experience no such notice received in similar cases. But if you had opted for presumptive assessment, then yes, you can be queried.

Rajiv

Rajiv (Querist)
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10 September 2025 Dear Sir,

Can I proceed with filing of return by showing speculative loss without audit?

Thanks in advance for your guidance.

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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10 September 2025 Yes. if you had not declared the income under sec. 44AD in any preceding FIVE years.

Rajiv

Rajiv (Querist)
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11 September 2025 Dear Sir,

Many many thanks for your advise.

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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11 September 2025 You are welcome....