Tax planning related

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jinesh (Querist)
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29 November 2014 Dear Sir,

I have a brother whos doing job and he is dealing in shares.
he generate heavy loss in last 6 months.
he does not file any return since begining.
he has borrowed amount from his retired dad.
his dad has transferred 4 lacs into his account.my brother has invested the same into the shares.
he is paying Rs4000 p.m. as interest to my dad from His share income?
Now, he want to transfer shares to his dad demat account and freeing his account so that he can file return.

what to do in that case. how to show Share income in his return? if we show then how to show and where to show the Income of share in Income Tax return?
what records to keep on hand for filing both the kinds of income?
what to do that he has borrowed Rs.4 lacs? He is paying Rs.4000 as interest to my dad from Profit generate from Share income?
which income Tax form is to be filed?

Please let me know the answers in detail.

Amol S Joglekar

Amol S Joglekar (Expert)
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29 November 2014 01. Use ITR 4
02. Now a days, due to digitisation, almost every record is digitally available, so need to take any scary attitude about keeping books of account.
03. Even the broker from where he is trading in shares...the software is capable of giving you the profit/loss for the whole year. You can make use of that
04. The real problem would be whether the trading income shall be regarded as BUSINESS income or Capital Gain. This is really a tricky area.
05. You said he has incurred LOSS, then why he is worried about filing income tax return...File it.

jinesh

jinesh (Querist)
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29 November 2014 Dear Amolji,

Please suggest the proper way to show this income as business income or capital gain. hwo to maintain the data in Tally regarding Salary Income and Share Income? please let me know.

Rupesh Jain

Rupesh Jain (Expert)
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29 November 2014 you can file income under the business and profession then you claim the intt. as exp.

and you are doing the share trading w/o taking delivery then you can add the loss and profit if it more than one crore then you have to take audit report u/s 44AB.

otherwise you can file the return as business.

you file ITR-4 for salary and business income.

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Amol S Joglekar

Amol S Joglekar (Expert)
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29 November 2014 Can you please give a specific example so that I can give guidance in a robust manner.
Say for example.....bought for you....sold for you......so and so

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