Income tax posers

Capital Gain

In Share trading, if an assessee is doing only intra day trading in equities, then what amount should be considered to decide 44AB turnover? Total of Sales/Purchase or Total of Difference amount (disregarding negative sign)

In Share trading, if an assessee is doing doing intra day, and trading within 2 or 3 days(say not actual delivery, but broker operated) then what amount should be considered as 44AB turnover? Total of Sales or Purchase or Total of Difference amount(disregarding negative sign)

In above example, will turnover change if the transactions are in Future or Future Option? or Comodities Exchange?

What amount should be considered as turnover, if there are some short term capital gain and speculative transactions?

AY 2015-16 POSERS

1. Yes it is mandatory to provide firms details and audit of the firm in yes or no in Schedule IF,

2. Assuming it is not an LLP, firm can claim loss u/s 44 AD. However if taxable income exceeds basic exemption limit, firm will be reqd to maintain books of accounts and get them audited. Income includes losses also.

3. Person holding passport is reqd to mention it in ITR.

CAPITAL GAIN:

1. Intra day trading in equities is chargeable under PGBP and that too assessable as Speculative Income and not under CG.

Accordingly, the aggregate of both positive and negative differences is to be considered as the turnover of such transactions for determining the liability to audit vide section 44AB.

2. Do you mean by Derivatives, they are chargeable under PGBP under Business Income.

The turnover in such types of transactions is to be determined as follows:

i) The total of favourable and unfavourable differences shall be taken as turnover.

ii) Premium received on sale of options is also to be included in turnover.

iii) In respect of any reverse trades entered, the difference thereon, should also form part of the turnover.

If not derivatives, refer 1

3. Same as 2.

4. If shares are held as investments then assessable as CG and hence no question of turnover whereas if shares are held as stock in trade then assessable as Business Income and if there is actual delivery whether intended or by default, the total value of the sales is to be considered as turnover. AND if there is no actual delivery, same as 2