Stock brockers
This query is : Resolved
29 June 2012
Hi,
Is stock brocker income is chargeable under business or capital gains.If he has F&O can he get the setoff of this with business loss. What are the tax benefits and deductions available for stock brockers. What are the deductions available to F&O transactions(expenses).
Is stock brocker income is chargeable under business or capital gains.If he has F&O can he get the setoff of this with business loss. What are the tax benefits and deductions available for stock brockers. What are the deductions available to F&O transactions(expenses).
CA PARAS BAFNA
(Expert)
29 June 2012
Stock Brokers are those persons who are entering into transactions in stock exchange on behalf of their clients. The income earned in this way is their business income.
A broker can claim all the business expenses
which are incidental and exclusively incurred for his business.
.
If Mr X is a client of a broker and he is making investment in shares. He will earn Capital Gains. If Mr. X is entering into transactions as a trading activity, his income will be termed as business income.
.
The F&O transactions are treated as normal business transactions and as such against F&O profit loss of a non speculative business can be set off. However, Capital Loss can not be set off against Business Profit.
.
A broker can claim all the business expenses
which are incidental and exclusively incurred for his business.
.
If Mr X is a client of a broker and he is making investment in shares. He will earn Capital Gains. If Mr. X is entering into transactions as a trading activity, his income will be termed as business income.
.
The F&O transactions are treated as normal business transactions and as such against F&O profit loss of a non speculative business can be set off. However, Capital Loss can not be set off against Business Profit.
.
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