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Intraday trader

11 August 2021

Dear CA's

Im currently jobless. before i was NRI. never filed IT in india. after completing my studies i went to dubai and worked there.

After Covid i came back to india and started Trading.Im a intraday trader and for FY 20-21 (april 2020 to march 2021) i mainly traded in Options (index).and my total turnover as per my broker is 67 lakhs and there is no profit . .for me it was loss around 26k

now could anyone guide me for filing ITR. do i need to file ITR (mandatory) ???

can someone quickly sumup me the category and tax slab rate where i belong to?

Thank you.

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15 Replies

Amit Maity (63 Points)
Replied 11 August 2021

Yes, it is mandatory to file itr, I think form itr3. No tax liability arise bcz your business income has losses.

Samantha J (1236 Points)
Replied 11 August 2021

Filing itr is must. File ITR 3 for non speculative business income.

1 Like

abdul azhar mohammed (13 Points)
Replied 11 August 2021

@ all.

What could be the consequences for not filing ITR3.(if i failed to file ITR by sept 30., can i file it at later date?)

additionally can u elaborate more on presumptive income.and tax slab rates.(which category should i opt for? im intraday trader mostly i trade with index options.)

thank you.

Samantha J (1236 Points)
Replied 11 August 2021

Https://youtu.be/dasrJ64Czfk. watch this YouTube video so that you can file ITR in time.Dont delay.

CA.Pujah (Service) (1005 Points)
Replied 11 August 2021

ITR-3 will be applicable to you. Intraday transactions would come under speculative income. Delay in return filing will result in penalty of 5000/- and the losses, if any won't be carried forward to next year. Better file it timely.

abdul azhar mohammed (13 Points)
Replied 11 August 2021

Could u plz answer few queries.

1.i have gone through the you tube link, i would rather go for service than going into technicals. Could u plz suggest a good service provider for filing the said ITR3.

2. What's the last date for filing ITR3. For 2020 2021.

3. If i want to opt out for service or don't want to file it for next year as i dont have any transactions in this financial year. Can i do that. I mean file for previous year and close my account with my broker.

4.can u give a chart or comparison table for tax slab rates. And transaction turnover limit for options (stock and index)and equity ( i noticed i had both short term intraday transaction and long term buy today and sold after 3 days, and intraday index options )for previous fin year.

Samantha J (1236 Points)
Replied 11 August 2021

If you have made any profit in any quarter and if it's more than Rs10000 advance tax is payable in that quarter resulting in interest payable 234A . You are saying you made loss but is it according to income tax Act? You will get demand notice for penalty for not filing ITR besides any interest applicable.

abdul azhar mohammed (13 Points)
Replied 11 August 2021

@ samantha i have made profit in Q3 but only 5000 and q1,2,4 loss as per tax pnl statement from my broker.

Any penalty applicable? I will file itr by this month end. Do u work/own any service provider for filing (CA service).

Samantha J (1236 Points)
Replied 11 August 2021

Only penalty will be payable.You can carry forward loss only if you file ITR.
Answers to earlier questions.
1.You can use TRP scheme to locate Tax return preparer near you.
Please note most CA and Tax return preparer don't know correct laws so you risk getting demand notice.
2Sept 30 . Actually you should have filed by July 31.
Yes.But you should file nil ITR returns as Dept also contravenes law and may send notice as to why you didn't file ITR next year and you will have to proove your authentic ity of your statement.
Tax slabs STCG @ 15% LTCG @ 10% for capital gains and for non speculative business you will fall as per normal income tax slabs, upto 2.5L nil, upto 5L 5%, upto 10 lacs 20% and beyond 10L 30 % .
You fall under 2Cr limit so no audit if you report 6% profit but if you say loss of 26k then audit is applicable.
Presumptive income tax report 67 L turnover with 6% profit cal tax and pay it and get out of problems.No audit then.

abdul azhar mohammed (13 Points)
Replied 11 August 2021

@ samantha. Could u please elaborate on penalty? I didn't get that point. Penalty will be imposed if i dont file itr by sept 30.. as i have not made profit in AY20-21 more than 10k in any quarter.

Can i get it audit and file nil return? I know a CA in my area. I cant show profit of 6% that would be around 402000 and tax would be around 8k as per my calculations. Plz correct me if I'm wrong.

Samantha J (1236 Points)
Replied 11 August 2021

.Penalty of Rs 5000 if no ITR filed. The software is not following IT Act and is charging penalty of Rs 5000 even when ITR submitted by sept 30.It should not charge as per ACT.
Get audit and report 26k loss which can be carried forward to next year.
CA might charge more than Rs 10000 for audit!
Wrong. Income Rs 402000 -rs250000-sec 80 C etc .
If no ch VI deduction claim then, rs402000-rs250000 which is Rs152000 will be at 5% that is Rs 7600 .

abdul azhar mohammed (13 Points)
Replied 11 August 2021

@ samantha. one last query..

any possiblity that i will be imposed with advance tax penalty for April 2020 to march 2021. i made loss in quater 1 2 4 and in other quarter only 5000 profit.? Plz advice.

advance tax is on Income or profit more than 10k? in my case its all losses.. what i understand by ur answer is that i need to file ITR3- Nil in my case and get it audited by a CA/Tax consultant.

5000 late fee which is applicable, (as mentioned ), and service charge of tax auditor for filing and auditing.

any other charges or penalties?

thank you

Samantha J (1236 Points)
Replied 12 August 2021

Advance tax is payable only if total tax payable after deduction of relevant amounts like ch VIA etc is more than Rs10000 for the year!
Best alternative is to get audit and file with loss to be carried forward.Since CA is known pay Rs 500 .Late fees will be payable Rs5000. So you end up paying Rs5500.
If CA asks for Rs 10000 then just file yourself showing 6% profit under presumptive income tax option.Here you will have to pay Rs 7600+Rs 5000 which is Rs 12600 ! but you can't carry forward loss!

abdul azhar mohammed (13 Points)
Replied 12 August 2021

@ samantha thank u for replies. I came across news on hindupaper that 5000 is not applicable now and the technical glitch has been resolved Whoever got charges filing itr will be refunded.

D u work for any firm which provides itr filing services??

I spoke to my CA friend he is saying that he will file under general category without audit. Is it possible. N he is charging me 3000 for the said services. I'm waiting for confirmation from other CA.

If i continue trading in this fy 21-22 and since I'm still in losses in quater 1 and quater2 , but slowly i started making profit after going through stock market training course.

In my case scenario, after filing ITR3 this month for previous fy and if i make profit of say 5 lakh in quarter 3 this year and turnover exceeds 2cr. I guess advance tax is applicable, do i need to file advance tax at Q3 end? Will i still be in non presumptive category?

Thanks