Turnover calculation of F&O

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This discussion clarifies how to calculate turnover for Futures and Options (F&O) trading. For futures, turnover is the sum of absolute profits and losses. The standard tax audit limit for businesses is Rs. 1 crore, and for professionals, it's Rs. 50 lakhs. This limit increases to Rs. 10 crore for businesses with less than 5% cash transactions, provided all other transactions are digital.

TULASISATYARAM

TULASISATYARAM (Querist)

17 June 2022 I would like know how to calculate turnover for trading made in Futures and Trading made in Options. what is the limit for tax audit?

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)

17 June 2022 In simpler terms, under F&O trading, the turnover of futures will be the absolute profit, which is the sum of positive and negative differences.
Tax audit applicable when such turnover exceed 1 crore.

CA Puja Sharma

CA Puja Sharma (Expert)

17 June 2022 The tax audit limit is Rs. 1 crore for business and Rs. 50 Lakhs for professionals.
The tax audit limit will be increased to Rs. 10 core for businesses which have cash receipts and cash less than 5% and all other transactions are through digital modes.
For turnover calculation, you can refer to this below link:
https://www.caclubindia.com/forum/calculation-of-turnover-in-case-of-f-amp-o-trading-364309.asp

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