Turnover in case of day trading

the amount deducted / credited by bank towards margin + charges is the basis of calculating turnover for retail traders.

contract value is to be taken for institutional traders. 

Originally posted by : U S Sharma
	the amount deducted / credited by bank towards margin + charges is the basis of calculating turnover for retail traders.   contract value is to be taken for institutional traders.

AGREED                                                

According to Section 44AB of the Income Tax (IT) Act, 1961, tax audit applies if turnover exceeds the limit of Rs 60 lakh from assessment year (AY) 2011-12 (up to AY 2010-11 it was Rs. 40 lakh).

For calculation of turnover for tax audit, the aggregate amount of positive and negative differences arising from dealing in such transactions is the turnover for speculative transactions.

For F&O the above rule should be applied.

For non-speculative business, i.e., delivery-based transactions, the turnover is calculated as total amount of sales.

Ref: Capital Market magazine

Sharma Sir

Please let me know who are retail traders and who are institutional traders in trading of shares.?

( ref from your reply regarding the turnover in day trading 15 days ago)