My friend is active share trader. He made income (profit ) of Rs 50 lakhs during the month of April 2010. His multiple share transcations (margin funded) are over Rs 3 crores. Out of 50 lakhs, 20 lakh profit he made by doing BTST trading. The remaining 30 lakhs profit he got by holding large quantities of shares of few companies for maximum period of 15 days. His dilema is as under
- Whether his profit is business income or STCG?
- Whether his transcation needs to be audited?
- Does he need to open current account (he has saving account)?
- If income is considered as business then how to reduce tax liability?
- Can he buy commercial property, shop, car, laptop ect from his business income and reduce the tax liability?
Thanks in advance.
CAclubindia
