Hi Diosys, here are a few questions. Would greatly appreciate your input.
I have the following for FY 2008-2009 (AY 2009-2010) and I have given my understanding of the taxation:
1. Income from fixed deposits >>> Taxable as per slab
2. Dividend from shares >>> Tax-exempt
3. Dividend from equity mutual funds >>> Tax-exempt
4. Dividend from debt mutual funds >>> Tax-exempt
5. Profit from intraday trading of shares, not F&O or derivatives >>> Taxable as speculative income as per slab with STT incurred being deductable
6. Short-term capital losses by frequently buying and selling shares on delivery basis on the exchanges (i.e. STT has been levied)>>> can be carried forward as business losses without adding STT to purchase cost and subtracting STT from sale cost.
7. Net short-term and long-term capital losses incurred by redeeeming of debt mutual funds.
8. Long term capital gains by redeeming equity mutual funds (with STT deducted by the fund house) >>> Tax exempt.
My guess is that I have to file ITR 4 because of items 5 and 6 above.
I have not kept books of accounts but I itemised all my transactions in a spread sheet for calculation purposes
If all the above is correct, then with reference to ITR 4, can you please throw some light on the following:
Part A-Gen --- Liability to maintain books of accounts >>> No since income is less than Rs. 1.2 lakhs from business, actually loss in this year.
Liable to audit >>> No since total of gains plus total of losses (minus sign ignored) for intraday and short term together is less than 40 lakhs.
Nature of business or profession >>> ???
Part A-BS --- will skip items 1-5 and fill "No account case" but what are 6a "sundry debtors" & 6b "sundry creditors" since I haven't borrowed or lent to conduct the business of intraday trading and buying and selling shares for short term delivery?
And what is 6c -- Amount of total stock-in-trade? Is the the total closing value of the shares held by me as on 31/03/2009?
And what is 6d -- Amount of cash balance? Is it the free cash lying in my trading account?
I hope you can help!
If you can, I will some more questions very soon!
I have the following for FY 2008-2009 (AY 2009-2010) and I have given my understanding of the taxation:
1. Income from fixed deposits >>> Taxable as per slab
2. Dividend from shares >>> Tax-exempt
3. Dividend from equity mutual funds >>> Tax-exempt
4. Dividend from debt mutual funds >>> Tax-exempt
5. Profit from intraday trading of shares, not F&O or derivatives >>> Taxable as speculative income as per slab with STT incurred being deductable
6. Short-term capital losses by frequently buying and selling shares on delivery basis on the exchanges (i.e. STT has been levied)>>> can be carried forward as business losses without adding STT to purchase cost and subtracting STT from sale cost.
7. Net short-term and long-term capital losses incurred by redeeeming of debt mutual funds.
8. Long term capital gains by redeeming equity mutual funds (with STT deducted by the fund house) >>> Tax exempt.
My guess is that I have to file ITR 4 because of items 5 and 6 above.
I have not kept books of accounts but I itemised all my transactions in a spread sheet for calculation purposes
If all the above is correct, then with reference to ITR 4, can you please throw some light on the following:
Part A-Gen --- Liability to maintain books of accounts >>> No since income is less than Rs. 1.2 lakhs from business, actually loss in this year.
Liable to audit >>> No since total of gains plus total of losses (minus sign ignored) for intraday and short term together is less than 40 lakhs.
Nature of business or profession >>> ???
Part A-BS --- will skip items 1-5 and fill "No account case" but what are 6a "sundry debtors" & 6b "sundry creditors" since I haven't borrowed or lent to conduct the business of intraday trading and buying and selling shares for short term delivery?
And what is 6c -- Amount of total stock-in-trade? Is the the total closing value of the shares held by me as on 31/03/2009?
And what is 6d -- Amount of cash balance? Is it the free cash lying in my trading account?
I hope you can help!
If you can, I will some more questions very soon!
Till point 5 you are absolutely correct....
Point 6 i am confused.... you say short term capital losses and want to carry forward it as business income...i presume you wanted to mention carry forward as capital loss...then in that case you are again correct...
7 & 8 are also correct....
Now your queries...
Liability to maintain books of accounts arises not only on income exceeding 1.2L BUT also if any of the three previous years you have had sales exceeding Rs. 10 L (which you might be having)....
Your Audit understanding is absolutely correct...not required.
Nature of business & profession "retail: Others"
Sundry debtors would be your money kept with the broker or similary if you owe to your broker as on 31st Mar 2009 then that money would be sundry creditor.
Stock in hand is the stock items you have (Shares etc)
Cash in hand is not the broker cash....it is the actual cash with you (may be in your wallet etc...)
OVERALL LET ME MAKE ONE THING VERY VERY CLEAR...I WOULD STRONGLY...REPEAT STRONGLY SUGGEST TO GET YOUR PROPER BOOKS OF ACCOUNTS MADE...may or may not be only for statutory compliances BUT also for utmost peace of mind....
