Fire your tax related queries and i would get it solved!!!

[vikaspanwar]

Dear nac,
I have gone through. Offcourse day trading for a part time trader will be a speculative income & teated separately.
I couldn't find whether 1) Day Trading Income for a full time trader (Having no other source of income) is a speculative income or normal trading income.
2) Whether These losses can be or cann't be offset with other gains/losses.
Regards
Vikas

 

[nac]

Dear nac,
I have gone through. Offcourse day trading for a part time trader will be a speculative income & teated separately.
I couldn't find whether 1) Day Trading Income for a full time trader (Having no other source of income) is a speculative income or normal trading income.
2) Whether These losses can be or cann't be offset with other gains/losses.
Regards
Vikas

1. Day trading income is a speculative income. No matter you're a full time trader or part time trader.
2. Yes, it can be set off. Speculative income can only offset speculative gain. Loss from speculation can be carried over for 4 years.

Follow his signature for more information.

 

[diosys]

Dear nac,
I have gone through. Offcourse day trading for a part time trader will be a speculative income & teated separately.
I couldn't find whether 1) Day Trading Income for a full time trader (Having no other source of income) is a speculative income or normal trading income.
2) Whether These losses can be or cann't be offset with other gains/losses.
Regards
Vikas

Though NAC has written his opinion correctly but there is one point missing in his answer....

Trading from F&O is not speculative be it intra-day....Day Trading in Cash is speculative...

Rest what NAC has written is correct.

 

[nac]

^ yeah I missed that part. Sorry, I try not to happen this again.

Just for a clarification...

We can show the following as expenses and deduct the same from our trading income.
* Broadband Charges
* Phone Charges
* Electricity
* Rent

For an individual, he stays in his place (home) and do trading. Is this possible for him to show electricity charges, Rent as his expenses? If yes, house and electricity bill should be in his name or it can be anyone who lives with him.
I guess we can show broadband/phone charges as expenses but about the connection... Should this be in his name or anyone's?

 

[diosys]

^ yeah I missed that part. Sorry, I try not to happen this again.

Just for a clarification...

We can show the following as expenses and deduct the same from our trading income.
* Broadband Charges
* Phone Charges
* Electricity
* Rent

For an individual, he stays in his place (home) and do trading. Is this possible for him to show electricity charges, Rent as his expenses? If yes, house and electricity bill should be in his name or it can be anyone who lives with him.
I guess we can show broadband/phone charges as expenses but about the connection... Should this be in his name or anyone's?

It would certainly be helpful if the connections are in his name...But even though it is not but ample proof is available that they were used then also proportionality it can be claimed.

 

[nikhilfake]

Hi !

I read your Tax Reckoner and have a couple of questions:

1) For Bank FD, TDS is charged when interest is above 10,000.
-> Is this 10k limit for all interest combined (savings a/c , multiple bank FDs) or just that for each FD , the interest should be less than 10,000 to not have TDS deducted,

2) For Debt Mutual Funds, the interest is taxed at 10% (20 with indexation))
->Do Monthly Income Plans (above 70% debt) qualify as Debt MFs?


thanks!
Nikhil

 

[magnet]

I think for fds they count interest separately and for quarterly savings interest no tds is deducted as like FDS or may be if that cross 10k individually that too might happen ...wait for SIR reply

I am not sure but sharing from personal experience

Recently mine fds yearly return from bank crossed 10.3k and i got letter to file tds form on that amount..on furthur checking i found only FDs interest were included not another 2k which i got for it being in savings salary account


For taxes on mf i have an attachment just sharing that....

I hope that helps

 

[diosys]

Hi !

I read your Tax Reckoner and have a couple of questions:

1) For Bank FD, TDS is charged when interest is above 10,000.
-> Is this 10k limit for all interest combined (savings a/c , multiple bank FDs) or just that for each FD , the interest should be less than 10,000 to not have TDS deducted,

2) For Debt Mutual Funds, the interest is taxed at 10% (20 with indexation))
->Do Monthly Income Plans (above 70% debt) qualify as Debt MFs?


thanks!
Nikhil

Technically TDS is required to be deducted for all your FD clubbed together if the interest payable on them exceeds Rs. 10,000 . It is NOT FD wise or quarter wise. It is assessee wise and year wise.

How and what the banks deduct is there headache, but the legal position is as i have explained above. in simple words All the interest earned on your FD's with different branches of same bank if exceeds Rs. 10,000 for the year then the banks should deduct your TDS.

The interest earned on savings is not included because it not earned on deposit.

MIP with more than 70% debt would be debt fund.

Rest has been explained by magnet is the attachment.

 

[smartboy1jan1982]

Hi Guys!

I have a question to all the tax experts here. I am a Student and a newbie trader, 25 years of age. Over the last couple of years I have accumulated a sum of around 2 Lakh Rupees in my bank account which I want to use for Intraday trading. This money is primarily saved from the pocket money given to me by my father every month and deposited by me in my bank account in cash. I have never had any job or anywhere else from where I had any income of my own to show to Income Tax department. I have never had to file any Income Tax Return as I had no income of my own ever.

Now the thing is that how will the IncomeTax department treat any profit that I earn through intraday trading in derivatives? I have been told by my broker that, as a student has no income to show for the initial trading capital, any future trading profit arising from the money received from my father as pocket money or gift will not be treated as my own but will be added to my fathers income as per Income Tax department rules.

Please tell me if what the broker says is true or not?
p.s. I have given "Student" as my occupation in the forms for my demat, trading and bank account?

Please suggest any remedy by which I can get any future Income earned from intraday trading treated as my own income by the Income tax Department and not added to my fathers income from whom I have received all the money as pocket money.

 

[diosys]

Hi Guys!

I have a question to all the tax experts here. I am a Student and a newbie trader, 25 years of age. Over the last couple of years I have accumulated a sum of around 2 Lakh Rupees in my bank account which I want to use for Intraday trading. This money is primarily saved from the pocket money given to me by my father every month and deposited by me in my bank account in cash. I have never had any job or anywhere else from where I had any income of my own to show to Income Tax department. I have never had to file any Income Tax Return as I had no income of my own ever.

Now the thing is that how will the IncomeTax department treat any profit that I earn through intraday trading in derivatives? I have been told by my broker that, as a student has no income to show for the initial trading capital, any future trading profit arising from the money received from my father as pocket money or gift will not be treated as my own but will be added to my fathers income as per Income Tax department rules.

Please tell me if what the broker says is true or not?
p.s. I have given "Student" as my occupation in the forms for my demat, trading and bank account?

Please suggest any remedy by which I can get any future Income earned from intraday trading treated as my own income by the Income tax Department and not added to my fathers income from whom I have received all the money as pocket money.

What your broker has told you is half correct. It is correct that income earned from money transferred from father is clubbed in father's hand BUT this is only till the son in is a minor i.e. below 18 years of age.

In your case since you are above 18 therefore whatever income is earned on this accumulated money would be taxable in your hand and not your father's.