Carry forward and set-off losses

i am doctor my fno loss are 20 lakh for assessment year 21- 22 .can i go for carry forward loss for 4 years and adjust my presumptive income from professional head for 4 years or 8 years
2.what will be quciko charges for the same if my turnover is less than 1 crore.
3 is there any additional benefit for zerodha holders

Hi @raj_gupta,

When filing your ITR, the losses are first set off against the respective heads and are then carried forward.
Since F&O trading is treated as non-speculative business income for Income Tax purposes:

  • The losses set off against any income head except salary
  • Carried forward to the next 8 years.

Like always, Quicko has special discounts for Zerodha Traders.

For details regarding ITR filing, you can drop your contact number here.

I earned profit from intraday fno. Where can i adjust it. Can it adjust against shares buying like we do in capital gains?

Hi @ADITYA_VASISTHA

Intraday fno is classified under Non Speculative Business Income. So profits from the same can be adjusted against Losses from House Property Income or Losses from Other sources Income.

Hope this helps!

I have no loss from other source or income head. Is there any way to adjust this profit?

Hi @ADITYA_VASISTHA

There is no other way to adjust the profits then.

Since it is Non speculative business income, you can claim all eligible expense incurred for the business.

Hi,
I apologize if my question seems repeated.I did go through other queries and still couldn’t figure it out by myself.I hope you don’t mind and help me figure this out.

In the initial years of my trading, I incurred losses in F&O trading.
I’ve declared that in my ITR and filed it b4 due date.
Since the losses, I gave up F&O trading and now I am purely concentrating on holding shares for at the least 1 year before selling it off.

Now I was wondering if the gains from my shares (LTCG) can offset the the F&O losses of my initial years,partly or completely, over the coming years,as I plan to carry forward the F&O losses until it is 0 or the max no of years have passed…(8 years,i think so).

My doubt arose because at one place I saw that F&O losses can be set-off against any income other than salary and in another place, that they can be set-off against F&O gains or equity intraday gains only.

I would be grateful if you could point me in the right direction.
Thank you for your time.

Hey @Aby_Math, F&O trading is classified as non-speculative business income from the income tax perspective.
You can set off non-speculative business income against any income except salary for the current year i.e. for that financial year.
You can only set of bought forward non-speculative business loss against future speculative or non-speculative business incomes. Therefore, you cannot set off F&O loss against your capital gains

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Salaried Income of 9 lac, incurred loss in Options & Intraday 1.7 lac, Carry forward loss from previous years is STCG loss 1.92lac, Can i file ITR-2 ?
Is there any limit to CFL amount or 8 years
F&O, Equity Intraday Trading profit/loss can also be included STCG & loss can be set off for future years

Hi @pradeepsalian,

Since F&O trading is treated as non-speculative business income you are required to file ITR 3.
You can carry forward the non-speculative business loss to 8 years, there is no limit on the amount of loss you can carry forward.

No, all of them are not treated as STCG, here is how they are classified:

  • F&O Loss - Non-speculative business loss
  • Intraday Loss - Speculative business loss
  • Equity, mutual fund, debt loss - STCL/LTCG depending on the duration

The rules to set off the loss against current year losses & for bought forward losses are a bit different.
For instance, you can set off F&O losses (non-speculative business loss) against any income except salary. However, you can only set off the bought forward F&O loss against business income.

This article might be helpful to help you understand it better:

What is the sequence of non-speculative income loss set off?

If we have a loss in non-speculative income, how does the set-off happens? I mean what is the sequence?
Other sources Income then STCG and then LTCG?

Hey @Jack_R, you can find the details of setting off your losses in detail from this article:

I made a short term loss on equity shares, how do I carry it forward - so I can set it off against future gains ?

Hey Krutarth,

In respect of any capital loss incurred by you, you have to show the same in your return of income to carry forward. Note that loss can be carried forward only when return has been filed on or before the due date.
The remaining balance of the loss can be carried forwarded to the next 8 financial years.

  • Short term capital loss can set off against both Long term and short term capital gains income
  • Long term capital losses can only be set off against long term capital gains income
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Why my Speculative loss set off with Other Source income? It shows on Quicko platform when I was preparing my ITR 3 in Review section. MY salary income Nil, Speculetive activity losses 20000 apx and saving ac, fd ac intreses are 5000 apx, in review section shown setoff 5000 and CFL is 15000.

Hello @Nikhil_Singh,

Speculative Business Losses can only be set off against speculative business income. The same rule is followed by Quicko’s tax engine. In your case, the losses that you have mentioned must be current year non-speculative losses which can, indeed, be set off against other sources of income.

You can refer to this article: Set Off and Carry Forward Losses under Income Tax | Learn by Quicko

I had done trading in F&O last FY and had some losses. I am carrying forward that loss.

This FY year I had just done investing but not trading. Can I file ITR-I this year and still carry forward the loss?

Hi @abhy3,

Yes, you can file ITR 1. When you wish to set off the loss against future gains, you can bring it forward when filing the ITR for that financial year.

Just a keep in mind: F&O is treated as a non-speculative business income and can be carried forward to 8 years.

Hello
Ref FY 2020-21
Can STCG be adjusted with loss from Business Income please advise/confirm
Say STCG = 5.5 Lac
Loss from Trading (Speculative and non Speculative Income) = 12 Lac
Salary Income 3 Lac
Other Income = 1 Lac

Hello
Ref FY 2020-21
Can STCG gain of 435 be adjusted with loss from LTCG of FY 4228 of FY 2019-2020? please advise/confirm