Comment on Taxation for Traders - Introduction
commented on
01 Jul 2013, 08:14 AM
Hi,Thanks for your reply. I have read most of the blog and your one particular reply has confused my understanding of trader taxation .
To my query you say that since trading is a business , you have to get your audit done and return filed even though your income is less than taxable limit.
ok got it. Below is a query and your reply which confuses me :
PraveenKumar_16Feb 3 2013, 3:11 pm
Hi team,
Could you please clarify that if an individual/ salaried person income is below the 2 lakh slab and he trades and makes some investments in shares . 1. This person doesn’t comes under taxable category. 2. Is it still mandatory to file returns because he trades in market? if he don’t what is the effect? 3. If yes which form he has to use? 4. Can he get benefit of carry forwarding the losses if his salary is the only income?
Zerodha replyFeb 3 2013, 3:27 pm
Hi Praveen,
If you are income is less than 2lks and you trade/invest in shares
You don’t come under taxable category and it is not required for you to file your returns. But my advise would be to still file it as it brings about a financial discipline and will help you in future when you approach a bank for a loan or other such activities.
It is not mandatory to file, but if you are filing you still use the same forms which I have mentioned in the article above.ITR1/ITR2/ITR4 based on how you are considering your trading.
Yes you can get the benefit of carry forwarding the losses even if salary is the only income. But to get benefit of carry forwarding the losses, you need to ensure that you have filed your returns before the due dates otherwise you let go of this benefit.
– In this reply you say its not mandatory to file return since income is less than 2 lakhs .
So whats the difference between my case and this case.