Taxation of shares & derivatives

it would be considered to be profit/loss from speculative business and would be taken under the head profits from business/profession.

If it a loss can it be set-off and carried-forward?
 

Dear Harry,

Plz find below;

1) Intraday/BTST(Bought Today Sold Tomorow)/ATST (Acquired today Sold Tomorow) of equity/preference shares shall be considered as speculative transactions and shall affect tax amount as speculative Income/loss. However, premium/net premium on Options shall be considered as your normal business Income i.e. not speculative business Income.

However, one should keep in mind the frequency of transactions to determine nature of assets/securities i.e. Business Assets/Capital Assets.

If you have only one option contract and has premium gain/loss than you may say that you have sold a right in shares and according it may get taxed as Capital Gains.

2) It depends on what statements is given by broker. In case broker Statements, you may directly arraive to taxable profits/loss by doing arethmatic excersice. It is very simple calculation.

3) The loss can be sett off and also can be carried forward in follo manner;

i ) In case of speculative loss (intraday), it can be adjusted against speculative income of same year and balance for subsequent 4 years.

ii) in case of business loss (options), it can be adjusted against business Income including spec income of same year and balance for subsequent 8 years.

Thanks