Selling of shares
Karan Agarwal (8 Points)
20 August 2022
what will be the reportable T.O in ITR for FnO and INTRADAY
Karan Agarwal (8 Points)
20 August 2022
CA Aakarsh Jain
(CA)
(10234 Points)
Replied 20 August 2022
Dhirajlal Rambhia
(SEO Sai Gr. Hosp.)
(161002 Points)
Replied 20 August 2022
For all speculative transactions, aggregate or absolute sum of both positive and negative differences from trades is to be considered as a turnover. So if you buy 100 shares of Reliance at 800 in the morning and sell at 820 by afternoon, you make a profit or positive difference of Rs 2000, this Rs.2000 can be considered as turnover for this trade.
For all non-speculative transactions, the turnover to be determined as follows –
So if you buy 25 units or 1 lot of Nifty futures at 8000 and sell at 7900, Rs.2500 (25 x 100) the negative difference or loss on the trade is turnover.
In options, if you buy 100 or 4 lots of Nifty 8200 calls at Rs.20 and sell at Rs.30. Firstly, the favourable difference or profit of Rs 1000 (10 x 100) is the turnover. But premium received on sale also has to be considered turnover, which is Rs 30 x 100 = Rs 3000. So total turnover on this option trade = 1000 +3000 = Rs 4000.
The above calculations (points 1 to 3) are fairly straight forward; the next important thing to decide though is if you want to calculate turnover scrip wise or trade wise.
Scrip wise is when you calculate the turnover by collating all trades on the particular contract/scrip for the financial year, find average buy/sell value, and then determine the turnover using the above 3 rules with the total profit/loss or favourable/unfavourable difference on this average price.
Trade wise is when you calculate the turnover by summing up the absolute value of profit and loss of every trade done during the year and following the above rules.
Let me explain both with some examples –
Using scrip wise:
Average Nifty Jan Fut buy: 200 Nifty Buy at 8050
Average Nifty Jan Fut sell: 200 Nifty Sell at 8075
Total profit/loss = 200 x Rs 25 = Profit of Rs 5000 = Turnover of Nifty Jan Futures
Using trade wise:
100 Nifty Buy at 8000, Sell at 8100, Profit = Rs 10,000
100 Nifty Buy at 8100, Sell at 8050, Loss = Rs 5000
Turnover of Nifty Jan futures = Rs 10,000 + Rs 5000 (absolute sum of the loss) = Rs 15000
Using scrip wise:
Average of Nifty Dec 8000 puts buy: 200 puts at 75
Average of Nifty Dec 8000 puts sell: 200 puts at 40
Total profit/loss = 200 x Rs 35 = Loss of Rs 7000
Total Selling value of options = 200 x Rs 40 = Rs 8000
Total Turnover for Dec 8000 puts = Rs 7000 + Rs 8000 = Rs 15000
Using trade wise:
Trade 1
100 Nifty Dec puts bought at 100 and sold at 50, Loss = Rs 5000
Selling value of options =100 x Rs 50 = Rs 5000
Turnover = Rs 10000
Trade 2
100 Nifty Dec puts bought at 50 and sold at 30, Loss = Rs 2000
Selling value of options = 100 x Rs 30 = Rs 3000
Turnover = Rs 5000
Total turnover = turnover of (trade 1+trade2) = Rs 15000
Courtesy: Zarodha
Eswar Reddy S
(CFO- at NHTF)
(58213 Points)
Replied 20 August 2022
sabyasachi mukherjee
(26273 Points)
Replied 21 August 2022
Eswar Reddy S
(CFO- at NHTF)
(58213 Points)
Replied 22 August 2022
CAclubindia
