Intra-day trade along with investment in shares

This query is : Resolved

Neeraj Sharma (Querist)
Follow

08 June 2020 An Advocate, who usually invest some of his savings in shares performs some intra-day trades only on 2 days in F.Y. 2019-20. My question is how will he treat his intra-day trading activity for the purpose of income tax:

1)Will intra-trading done on 2 days be a part of speculation business? If yes, then can he file his return under 44AD? What will be the turnover in case of speculation activity? Will shares purchase and sold during the year as an investment will also be part of the turnover?

2)Will it be right for the purpose of income tax if he shows his income from day trading as speculation business income and show shows short term capital gain on sale of shares he held as investments?

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
Follow

08 June 2020 1 yes, intra day trading is speculative and 44AD not available. Shares purchase and sale will not form part.
2 It will be right for the purpose of income tax if he shows his income from day trading as speculation business income and show short term capital gain on sale of shares he held as investments.

Message likes : 1 times

Neeraj Sharma

Neeraj Sharma (Querist)
Follow

10 June 2020 thankyou sir for your expert advice. But, I have one more question that, how will be the computation on income,
(i) will we consider total of purchases reduced by total of sales as income? or,
(ii) will we consider the aggregate of both positive and negative differences of each scrip as the turnover (as given in the "Guidance Note on Tax Audit under Section 44AB of the Income Tax Act,1961"). If yes, then in such case what will be the income?

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
Follow

10 June 2020 Consider the aggregate of both positive and negative differences of each scrip as the turnover (as given in the "Guidance Note on Tax Audit under Section 44AB of the Income Tax Act,1961").
Net of positive and negative will be income.

You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now

Join the CA Students WhatsApp Community for ICAI Updates, Trending Courses & Notes!

Similar Resolved Queries

Unanswered Queries

Popular
Recent

Trending Online Classes

Direct Tax Laws & International Taxation May 26,Sept 26 & Jan 27

CA Arvind Tuli

Enroll Now
Audit Fast Track Recorded Batch For May 26,Sept 26 & Jan 27

CA Aarti Lahoti

Enroll Now
DT & Audit (Exam Oriented Fastrack Batch) - For May 26 Exams and onwards Full English

CA Bhanwar Borana & CA Shubham Keswani

Enroll Now

view all classess

Meet our CAclubindia PRO Members

SARAVANAN PALANISAMY

Vishnu Agarwal

SHUBHANGI GOEL

Shivchandra Jakhotia

CA Lalit Kumar Agrawal

Subscribe Now

Intra-day trade along with investment in shares

Similar Resolved Queries

Trending Online Classes

Meet our CAclubindia PRO Members

Quick Links

Browse by Category

Latest Job Openings

Senior Executive

Manager- Finance and Compliance

GST CONSULTANT

GST CONSULTANCY

Accountant

CA Final

Article Assistant

Associate CA