Comment on Taxation for Traders - Introduction
commented on
06 Jan 2015, 08:27 PM
Sibi, if you are taking money from others to day trade, the legal way to do this is quite tough.
1. Get a PMS license, with a PMS license you cannot do intraday trades though. You can do delivery based trades, and F&O trades can be done only to the extent where you are hedging your portfolio. Also Minimum investment per individual is Rs 25lks.
2. AIF (alternate investment fund), basically a hedge fund, this requires you to have minimum of 20 crores worth asset under management. Minimum Rs 2 crores per individual.
My guess is that, the above might be a little steep as per your requirement. One of those things that you can do, which is kind of a grey area is to create a limited liability partnerships. Your friends and you together start a LLP with an objective to trade/invest. Each of the partner invests money into the LLP, and he gets a shareholding based on this. But do speak to a CA before taking any steps.