How to calculate Futures and Options Turnover as per Income Tax A…

In this video, I have explained how to calculate turnover of futures, options and intraday cash market trades. Everything is …

37 thoughts on “How to calculate Futures and Options Turnover as per Income Tax A…”

  1. Regarding Tax Audit, As per section 44AB the threshold limit, for a person carrying on business, is increased from Rs. 1 Crore to Rs. 10 crores in case when cash receipt and payment made during the year do not exceed 5% of total receipt or payment, as the case may be. In other words, more than 95% of business transactions should be done through banking channels. Now my f&o turnover is 1 cr 50 lac (zerodha calculated this not me)and I incurred loss of 4 lac effective , Since I do all transactions online I should not be eligible for tax audit as per above 10 cr clause right? But my CA is going for tax audit. Kindly help to clarify how tax audit is applicable to me if my turnover is below 10 cr and all transactions are online digital and this is first time I am showing business income ? Is there any further clause applied on top of this which makes 10 cr clause void for me?
    1.I read if last year itr filed under section 44AD/44ADA then only this year 44AD/44ADA is applicable.This is my first year showing business income/loss (f&o loss) , so last year itr was NOT filed under section 44AD/44ADA. then this year should not be right as per clause right? So no tax audit is applicable right?
    2.Also I read that Audit not required if you did not show presumptive business income in last 5 year.I never had business income till this assessment year so no question of showing presumptive business income in last 5 year am I still applicable for tax audit if this is my 1sy assessment year of business ( f&o) income/loss?

  2. Thank You Sir. You have clearly explained how to calculate turnover on options trading, it is of great help for filing ITR 3.?

  3. Rule is changed now.
    Please confirm accordingly new rule.

    If f&o total turnover is less than 10 cr than no requirement of audit right?

    And profit should be above 6% is also not mandatory for such case?

  4. Thank You Sir…one question though…Kya brokerage and other taxes total profit mese minus kar sakte he kya??

  5. for intraday option trading is same method applicable as premium by option selling gets added in fund end of the day

  6. Premium amount is added in case of option seller who receives premium but option buyer does not receive any premium so in their case no premium amount is added as turnover.

  7. Sir please reply .sir Maine distributor ka business krna hai or goods other state say mangva kr apni puri district main sale krna hai..kya mujhey dealer sale krne k liye gst lena he padega. Meri turn over maximum 30 lac hogi .or meri state main 40 lac turn over allowed hai.plz reply sir??????

  8. is turnover in intraday options buying and/or carrying it for next day or two, are calculated separately and are they also taxed differently?

  9. In case of Option Selling , how does it work? Is it the premium we get initially when we sell + abs(profit/loss) ?
    Please reply

  10. Thanks bahi for the information but jaise hum bahut chote chote profit book karne ke liye option main contract buy karke within 2 or 3 min main sell kar date hai to is hisab se humne as per turnover 2 lac ki buy or sell kar liya but profit to 1000 ka hua to mera question ye hai ki 1 saal main is hisab se turnover to ho jayage 5cr se upar aur profit hoga 1 lac or 2 lac to isse tax main kya problem ayaega aur kitna tax dena padega pls reply bahi

  11. So if i hav say selling value of intra day for more than rs.1 cr but the turnover is 3 lakh so the audit would not be applicable?

  12. Sir I feel guidance nite issued by ICAI on determination of turnover
    1.sum of favourable and unfavourable transactions..Is applicable for futures
    2.Premium received on options and 3.any reverse trade happens then the difference to be considered
    Hence 2 and 3 are applicable for options only and 1 for futures.
    Thus where 2 option trades are entered
    1.sold options worth Rs.1000 and expired worthless
    2.Sold options worth 1000 and bought at 1200.
    In that case turnover ti be only Rs.1000+1000+200 totalling to Rs.2200
    And not 1000+1000+1000+200 which is Rs.3200
    Kindly see point 3
    In respect of any reverse trades entered, the difference thereon should also form part of the turnover
    What is the relevance of this.
    No clear explanation on this.

  13. ls tax audit necessary if my option turnover is between 1cr + and have loss of 2L + and
    I don't do job? What to do?

  14. Imagine I am showing Futures trade as 44AD in my return. Is 6 percent to be applied on the Absolute value as mentioned ?

    So absolute value * 6 percent?


  15. Is tax audit necessary if my option turnover is between 1-2 cr and I have loss of 2L and my salary falls in the tax slab of 2.5-5L. please reply sir?

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