CA Kavita (Chartered accontant) (95 Points)
14 April 2009i have to prepare a return of income who has investment in shares and having intraday shares transaction..
can anyone pls tell me how to calculate profit if a person have invested in different Scripts,where to record amt of brokerage, stt,service tax???
and how and where to give effects of all thess while filing return of income??
Ashish M
(Chartered Accountant)
(2731 Points)
Replied 14 April 2009
If the purchase/sale of shares r in the course of business
show the purchase of shares as stock in trade and sales as sale of stock.................
the STT paid shall not be included in the purchase price and shall be deducted undr Sec.36(1) seperately
the brokerage / service tax paid shall be claimed as business expense seperately....i.e.( purchase price shall include price excluding service tax, STT and brokerage and claimed seperatly)
If the purchase/sale of shares r otherwise........
As the transactions r intra day, it shall be liable to STCG/L...............
The purchase price of the share is deducted from the corresponding sale price of the same scrip at later date.........and the difference is liable to cap gains tax.
for this purpose, purchase price shall not include any Service tax, STT or brokerage..........
though brokerage(including service tax) can be claimed as expenses on transfer........in case of cap gains..STT can't be claimed..............
N.J.R
(Practice)
(346 Points)
Replied 04 May 2009
| Originally posted by :kavita | ||
| " | i have to prepare a return of income who has investment in shares and having intraday shares transaction.. can anyone pls tell me how to calculate profit if a person have invested in different Scripts,where to record amt of brokerage, stt,service tax??? and how and where to give effects of all thess while filing return of income?? |
" |
(1) Investment in Shares :
When an assessee sells any scrips, capital gain either long term or short term will arise.
While calculating capital gain, STT should be excluded from cost price & sale price of shares.
Prepare statement of Capital Gain one for long term & other for short term as under
Script name / Sale Date / Sale Price (excl. STT) / Purch Date / Purch Price (excl STT) / Gain or Loss
Above statement should be prepared periodically giving totals of aggregate Sale Price, Cost Price & Gain or Loss upto 15/09, from 16/09 to 15/12, from 16/12 to 15/3 & 16/3 to 31/3.
(2) Intraday Transactions :
As far as intraday transactions (i.e. without delivery square off) are concerned, they are regarded as Speculation Profit or Loss under Business Head. Such Speculation profit or loss can be net off STT paid as from this year STT is allowable exp. under business head & rebate u/s 88E has been abolished.
As far as Brokerage & other charges are concerned, they can be regarded as cost or selling price in both the situation and hence allowable as deduction. Practically speaking, if u don't bother about negligible amount of brokerage & other charges then treat these exp as disallowable & ignore them while calculating gain or loss.
CA SUDIPTA SINHA
(Commerce Coaching- Accounts Cost FM)
(735 Points)
Replied 05 May 2009
the intra day transaction does not result in capital gain. the result of intra day transaction should be ragarded as speculation pforit/loss. the brokerage on purchase and sales should be adjusted directly i.e. rates should be adjusted for brokerages paid. the other expenses should be considered as normal business expenses for the purpose of day trading.
if shares are held and deliveries are taken then capital gains should be considered.
M.M.SURANA
(Director -Taxation )
(532 Points)
Replied 11 May 2009
I agree with Mr. NJR and Sudipto sinha in the matter of Intraday. U should tak the spuareup entry in the books of accounts. as Profi/Loss as per the Contract Note issued by the broker. i.e. accouting head Speculation Profit /Loss forming the part of Business Income saparately for tax purpose as well as for set off and carry forward also
Rahul Chobdar
(Chartered Accountant (Financial Management))
(561 Points)
Replied 12 May 2009
my doubt is also cleared
Thank you
Vineet Srivastava
(3 Points)
Replied 19 January 2021
I think, the loss from the intra day trading will be non speculative business loss. It cant be treated as capital loss in any case as there is no delivery involved into this.
GST Live Certification Course (39th Batch) - April 2024 (Weekend Batch) (With Certificate)
"Live class on Python for Financial Analysis: Unlocking Efficiency in Accounting and Finance"
CAclubindia
