Equity trading - business / capital gain

ITR 1094 views 4 replies

Harinder

student

219 Points Joined January 2008

Dear All;

I have done some equity trading on NSE listed shares over two months regularly. For Income Tax Return I will have to file ITR 4 and show Equity Trading as my Business Income / Loss, correct me if wrong. But, recently my colleague brought me a thought that, equity trading can be shown as Income / Loss from Capital Gain / Loss (Short Term) instead of Business Income. Now, I'm bit confused:

Wheather to show Equity Trading as Capital Gains or Business Income in ITR.

Please help me out. Thanks

Replies (4)

CA Saurabh

none

29 Points Joined December 2007

Dear, if u are trading in cash segment and trading without delivery of shares(i.e.on same day) than it is income from business (speculation), however if you are taking delivery than it wil constitute short or long term, depending on period of holding.

And if you are dealing in futures & options, it will constitute Income from business.

Saurabh Maheshwari

B.com ACA

5923 Points Joined December 2011

The ghain loss from intrday transactions are Business Gain/loss and the gains from Interday transactions are STCG/LTCG.

Use this excel sheet

Saurabh Maheshwari

B.com ACA

5923 Points Joined December 2011

PS - Exel file for Share gains calculation...

Harinder

student

219 Points Joined January 2008

Thankyou for reply, CA Saurabh and Saurabh;

I usually take delivery of shares in cash and sell them after a day or two.

Infact I also have Commission Income from another profession. So, I thought I can file ITR 4 for share trading and show the Commission earned as other income in Equity trading business. As I have loss this year, I can carry forward the loss (net of Income from Comission) for next 8 years under ITR. Correct me if wrong.

My only point is, should I show Equity trading as business loss (net of Commission) or show it as Short Term Capital Loss.

Please help.