Comment on Taxation for Traders - Introduction
commented on
15 Jun 2014, 09:39 PM
Sir, Kindly clarify as how to account the unsettled positions in the P&L account for taxation purposes? for example imagine that FUTIDX 25APR2013 NIFTY of 50 Nos were sold on 25-03-2013 for Rs.5746.5 and another FUTIDX 25APR2013 NIFTY of 50 Nos were sold on 02-04-2013 for Rs.5758.95. And supposing that these two positions were closed on 08-04-2013 for Rs.5581 (i.e Qty of 100 bought for Rs.5581 each).
The above two transactions typically appear in the P&L statement for the year ending 31-03-2013 and 31-03-2014 as below:-
For 2012-13
Buy Qty: 0, Buy Value: 0, Sell Qty: 50, Sell Value: 287105.89, Realized P&L: 0, Balance Qty: (-50), Avg Price: 5742.12, Clsng Rate: 0, Holding Value: 287106, Mkt Value: 0, UnRealized P&L: 287105.89, Total P&L: 2,87,105.89
For 2013-14
Buy Qty: 100, Buy Value: 558363.16, Sell Qty: 50, Sell Value : 287713.14, Realized P&L: 8531.56, Balance Qty: 50, Avg Price:- 5583.63, Clsng Rate: 0, Holding Value:- 279181.50, Mkt Value:- 0, UnRealized P&L: -279181.58, Total P&L: (-270650.02)
By accounting these transactions in the aforesaid manner, I think that certain excess profit is shown for the year 2012-13 and correspondingly excess loss shown for the year 2013-14. I hope the manner of accounting as stated above is incorrect. I request you to enlighten me how to correctly account the above transactions.