Avoid showing Speculative loss in ITR

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A teacher filing under Section 44AD is concerned about declaring significant speculative losses from stock trading. They wish to avoid showing these losses to maintain their presumptive income status. However, advice suggests that share trading transactions are reported via SFT, making it advisable to declare them in ITR 3 to prevent future queries, even if not offsetting the losses against income.

Saahil

Saahil (Querist)
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12 November 2021 Hi
I am a teacher and filing tax returns u/s 44AD for couple of years with ITR of 3 Lakh by showing
> Tuition Income : Rs 2 Lakh
> FD Interest : Rs 50K
> commission : Rs 50K

This year i entered and started speculative transaction in Stock market for 5 months in Equity having
> Total Turnover - Rs 75 Lakh
> Equity Intra Day Delivery Loss - Rs 35K
> Equity Short Term capital loss - Rs 7000
> FnO Loss - Rs 50K
and thus after incurring heavy loss of Rs 92K stopped share trading

If I dont want to use this loss against my income. like it was speculative and share trading closed. can i still be allowed to file tax return u/s 44AD as regular tuition income and also any repurcursion of not showing losses in ITR.

Thanks pls guide

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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12 November 2021 You need to declare the share trading business in ITR 3, to avoid any future query.
Due to SFT reporting, the share trading transactions would be available to ITD.

Saahil

Saahil (Querist)
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12 November 2021 Hi - Thanks, As its a loss and was speculative in 5 months and share / fno trading stopped and balance amount withdrawn (started in June'21 and stopped in November'21) - thus
> can i choose to not to show share market loss as it was speculative and was not a business
> As I dont intend to adjust loss against income thus can continue filing return u/s 44AD

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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12 November 2021 Otherwise also in ITR 3 your earlier declaration can be declared as it is. So, why you are worried about hiding the share transaction details.

Saahil

Saahil (Querist)
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12 November 2021 Hi - actually i dont want to move away from Section 44AD of presumptive income. If i show up this loss then i cant avail or continue with section 44AD - thats the only reason
Is there a way to continue with section 44AD

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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12 November 2021 The fear of loosing the benefit of sec. 44AD due to share transactions itself is on wrong footing.
If teaching is your business and not PROFESSION (!!!), you can continue it even with additional business of share market.

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