Can Real Estate Trading is treated as business profit and loss.

Hello,

I have a partnership firm, I m a wholesale trader of Agri commodities and in my GST that business is already registered, Now I start a parallel business with the same registered firm and the business is Flat House, Land, Agriculture land purchase, and sale of 2-4 months quotation on agreement and registry basis. So my question is can I add this business or trade activity to my GST registration and treat this profit and loss as business profit and loss. If this is possible then please provide a case study of the same with act/sec. details in which I can do this business, as my CA is denied this that this activity and trading is only treated as capital gain and loss, not business profit and loss. I want to treat the same as business profit and loss whatever tax rate is 30% + cess either LTG and STG tax are lower than business profit tax rate.

 

Thanks

Replies (1)

Yes Sir. Definitely possible to merge real estate trading transactions into your business p/l. the term business is defined under income tax act under section 2(3) that business’ includes any trade, commerce or manufacture or any adventure or concern in the nature of trade, commerce or manufacture. further various courts have through their judgements clarified and interpreted business in relation to volume, frequency.

Also, slab rates shall apply in case of individual offering the same as business income or short term capital gains.

however, in case of long term capital gains, tax shall be 20% with indexation benefit.

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