Derivative turnover

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ritesh (Querist)

22 July 2013 hello,
iknow that the difference of contract value are to be taken as the future and options turnover add the negatives difference also.

my query is:

1.what if the future contract is not expired or squared off on 31/3/2013. what should be done in such case.

2. in option the premium received is only considered for turnover. so what is the treatment of premium paid to buy a call.

i hope some can clear my query

thank you

CA PARAS BAFNA

CA PARAS BAFNA (Expert)

22 July 2013 The contract would have expired till the "calculation of turnover" gets completed.
so take its loss or profit in account.
.

Let Premium received be " Sales" then what would be Premium Paid ? and by this logic , we know that purchases are not considered as turnover for Section 44AB.
.

Message likes : 1 times

ritesh

ritesh (Querist)

29 July 2013 I have one doubt. sum of positive and negative diffrence of future trades is the turnover.

Shouldn't we subtract twice the amount of losses to correctly arrive at GP, because while originally calculating the turnover, we had removed the minus sign on losses.

Example:
Trade 1: -5,000
Trade 2: +10,000
Trade 3: -2,000

Thus turnover = 17,000. GP is really 3,000. To arrive at GP correctly, we need to calculate: 17,000 - 2*(5,000+2,000).

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