AN INDIVIDUAL BOUGHT APRIL FUTURES IN MARCH 2023. CAN THE NOTIONAL LOSS BY TAKING MARKET VALUE AS ON 31.3.23 BE BOOKED AS SHORT TERM CAPITAL LOSS ALTHOUGH THE POSITION HAS NOT BEEN SQAURED OFF AS ON 31.3.23?
Menu
NOTIONAL LOSS IN FUTURES
Replies (3)
Quick Summary
No. it is business income and is assessed at the time of square off.
You cannot book profit / loss unless the same is realised.
No notional (MTM) loss on open futures:
• ICDS I and CBDT Instruction 3/2010 disallow mark-to-market losses on open derivative positions at year-end, unless realised. So the notional loss on April futures as on 31 March 2023 can't be claimed in FY 2022-23.
• Futures are marked to market daily by the exchange (MTM settlement in cash). Daily MTM settlements are realised cash flows. Some tribunals treat them as realised. CBDT practice: ICDS disallows MTM losses (other than specific cases).
• Book the loss in the year of square-off or expiry.
Recent Topics :
- E-waybill 14 Digit Numbring
- Non filing of MGT-14 for MD appointment
- HUF AFFIDAVIT vs HUF DEED - REQUIREMENTS & STA
- Free Pre-Filing Tool to Match GSTR-3B vs GSTR-2B (
- MR AASHOK KUMAR SHARMA
- NIC codes for FIRMS registration of entity
- Register on Income Tax as CA
- Deduction In Employee Provident Fund
- This is a gift for all Chartered Accountants and P
- NRI, ITR-2 FY 2025-26: AIS Part B2 (SFT) shows hig
Related Topics :
CAclubindia
