About this plan
This plan is specially crafted for individuals involved in Futures & Options (F&O) trading on stock exchanges like NSE/BSE. F&O income is treated as business income under the Income Tax Act and requires proper reporting, tax computation, and in some cases, audit. Filing your ITR accurately helps avoid penalties, scrutiny, and ensures long-term compliance for traders and investors.
We help you calculate your turnover, expenses, and profit/loss, and file the correct ITR (usually ITR-3 or ITR-4) based on your trading profile.
Services Included
- Consultation with CA/Tax Expert
- Analysis of Trading Statements (Zerodha, Upstox, AngelOne, etc.)
- Turnover Computation as per Tax Guidelines
- Calculation of Business Income (Profit/Loss)
- Preparation & Filing of ITR (Form ITR-3 or ITR-4)
- Final ITR acknowledgment shared
- Calculation as per both the Tax Regime and selection of one which is best for you
Who Should Buy
How It's Done
This plan is equipped with end-to-end online fulfillment via our expert. No hassle, 100% Digital.
3 Days Estimate
- Upload Documents on Vault
- Review computation sheet
- Get ITR-V after e-filing
Documents Required
FAQs
What is F&O trading?
F&O trading refers to Futures and Options contracts which are derivative instruments traded on stock exchanges. These are used for hedging or speculative purposes.
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Is income from F&O trading taxable?
Yes, income or loss from F&O trading is considered as business income under the Income Tax Act and is taxable accordingly.
Which ITR form is applicable for F&O income?
Generally, ITR-3 is applicable for individuals and HUFs having income from business or profession, including F&O trading
Do I need to maintain books of accounts for F&O trading?
Yes, if your F&O turnover exceeds the prescribed limit, you are required to maintain books of accounts as per Section 44AA
Is audit mandatory for F&O traders?
Tax audit under Section 44AB may be applicable if:
- Turnover exceeds ₹10 crore (if all transactions are digital), or
- Profit is lower than 6% of turnover and income exceeds the basic exemption limit.
What if there is a loss in F&O trading?
Loss from F&O trading is considered non-speculative business loss and can be:
- Set off against any other income (except salary) in the same year
- Carried forward for up to 8 years and set off only against business income
Can presumptive taxation (Section 44AD) be used for F&O income?
No, F&O trading is considered a non-speculative business, but presumptive taxation under Section 44AD is not applicable to derivative trading.
What documents are required for F&O return filing?
- Trading statement from broker (P&L and contract note)
- Bank statement
- PAN, Aadhaar
- Other income documents (e.g., interest, salary, house property etc.)
How is turnover calculated for F&O transactions?
Turnover for F&O is calculated as the sum of absolute profits and losses from all trades, plus premium received on options.
Why should I file an ITR even if I have a loss in F&O?
Filing ITR helps:
- Carry forward your losses for future set-off
- Avoid income tax notices
- Maintain compliance for loan, visa, or credit card applications
Can salaried individuals file F&O returns?
Yes, salaried individuals involved in F&O trading must file ITR-3 and report both salary and business income
What happens if I don’t report F&O income or losses?
Non-reporting can lead to:
- Income tax notice or penalty
- Disallowance of loss carry forward
- Rejection of loan or financial applications
Do I need a CA to file F&O returns?
While it’s not mandatory to have a CA, it is highly recommended due to the complexity of:
- Turnover calculation
- Reporting business income
- Audit applicability
- Set-off & carry-forward of losses
Are F&O losses speculative or non-speculative?
F&O losses are considered non-speculative business losses under Section 43(5) of the Income Tax Act. This is unlike intraday equity trading, which is speculative.
Is GST registration required for F&O traders?
No, F&O trading is considered a securities transaction, and GST is not applicable on such trades.
What if I have multiple trading accounts?
You need to combine all trades across brokers to compute turnover and profit/loss consolidated, and file a single ITR accordingly.
Is trading in cryptocurrency considered F&O?
No. Cryptocurrency is not F&O. It is treated differently and is taxed under Section 115BBH from FY 2022-23 onwards