Stock brokerage income classification in ITR

Hi, I have a small query regarding Income tax.

My main income is from investments in shares, bank fds, bonds etc & no other income. I fill ITR 2, while filing returns. My net income is not taxable right now.

Now, I have taken a stock broker's trading terminal & plan to start client work & earn brokerage. The trading terminal is in my personal name & I do not want to create any seperate firm or any entity. My 3 small queries which are as below.

1. The share brokerage income will be included in my income. I understand that. Am I right?

2.There will be some expenses like office expenses, tea, telephone expenses, terminal rent etc. Can I claim deduction of those expenses, while filing ITR

3. I have a seprate bank account for stock trading terminal. Now, as my main income will be from share, fd, bonds investment, & the brokerage income will be shown as business income, so will the accessing officer combine all my income & show as business income?  

I understand that I have to fill ITR 4 this time. Is it right? Please let me know. I am very confused. Thank you for taking your time to read my query.
Regards,

Replies (2)

Mr Captain Kumar,

Following is the reply to your query,

1. Share Brokerage Income will be your Business Income

2. Yes, you can claim all the above expenses

3. Your Other Income from shares, fd etc will not be a Business Income but Income from Other Sources.

4. You have to file ITR-4

Agree with pracheta shirish deshmukh.but with some modification-

Income from share is depend upon their holding period ,

as it may be treated as-

1. LTCG(More than a year)

2. STCG (Less than a year)

3. Speculative business income (Intraday trading) section 43(5) of the ACT.

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