SEBI says 93% of F&O traders made an average loss of ₹2 lakh in FY23–24. Many think losses don’t need reporting, but that’s a myth.
👉 Loss ≠ No Filing
Even if you’ve incurred a loss, F&O trades must be reported in ITR, under non-speculative business income.
👉 Which ITR?
File using ITR-3 or ITR-4
👉 Why report losses?
✔ Set off against other business income, capital gains, rental or interest income
✔ Carry forward unadjusted losses for 8 years
✖ Cannot be set off against salary income
👉 Claim business expenses
Internet, brokerage, advisory fees, etc. claim them if they’re related to trading. Keep proof handy.
👉 Books of accounts needed if
• Income > ₹2.5L or
• Turnover > ₹25L in any of last 3 years
👉 Tax Audit
Audit Required If:
• Turnover > ₹10 Cr (irrespective of profit/loss)
• Turnover between ₹2–10 Cr without presumptive taxation and profit < 6%
Audit Not Required If:
• Turnover < ₹2 Cr and profit ≥ 6% (under Section 44AD)
• Turnover between ₹2–10 Cr, 95%+ transactions digital, and opting presumptive
👉 How to calculate turnover?
Sum of absolute gains & losses (not contract value).
Eg: ₹1K profit + ₹2K loss = ₹3K turnover.
👉 Advance Tax
• If tax due > ₹10K, pay in installments
• Under presumptive, pay full by 15 March
Stay tuned for more tax updates
