Should we mention NET INCOME or GROSS INCOME in itr 3?

Any idea what should we put here, net or gross income?

Part A - Trading Account - 12. Gross Profit from Business/Profession - transferred to Profit and Loss account (6 − 7 − 8 − 9 − 10xii − 11)

 

In Part A - P & L, it says

"13. Gross profit transferred from Trading account (12+12b+12d)"

Replies (2)
Quick Summary
A taxpayer filing ITR-3 seeks clarification on whether gross income or net income should be reported in the Trading Account and Profit and Loss schedules. The query focuses on correctly reporting Gross Profit transferred from the Trading Account to the P&L Account.

SME IPO: Preferred for lower costs, faster timelines, and strategic credibility-building before eventual "up-listing." Form 10E: You may manually override incorrect automated values, provided you keep a meticulous, documented working sheet. Surcharge: Triggered by "Total Income," which usually includes capital gains before exemptions like Section 54 are applied. ITR-3: Ensure you correctly distinguish between Gross Profit (from Trading Account) and Net Profit (from P&L Account) as requested by the form's specific line items.

In ITR-3, income should normally be given gross under the respective heads of income; the return itself gives provisions for deductions, expenses, and set off wherever applicable.

For example:

  • Business/Profession: Report Gross Receipts/Turnover and Claim Eligible Business Expenses to Arrive Net Profit
  • Income from Other Sources: Report Gross Income and Only Those Deductions Specifically Allowed Under the Income Tax Act
  • House Property: Disclose Gross Annual Value/Rent and Then Claim Standard Deduction & Interest Deduction As Applicable

If you are talking about a specific Schedule/Field in ITR-3 then please let me know. Treatment varies if the field asks for Gross Receipts, Gross Income or Taxable (Net)Income

Generally speaking, don't just key in the net taxable figure unless instructed otherwise by the specific schedule. Show the gross figures first and then claim eligible deductions/expenses in their respective fields so that the computation makes sense.

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