I hold an account with Zerodha Broker using my Pan Card. However, I use 50% of my funds and 50% of my uncle’s funds for trading (this can be considered a loan amount). For my uncle’s fund, I pay him a monthly interest amount. In this case, how do we calculate the income tax.
- Do I need to pay income tax for all full profit amount or
- I need to deduct this interest component amount as interest expenses in the Trading & Profit/Loss Account, and then calculate the Net Profit and Pay tax to the Net Profit Amount.
Case2: If I consider my uncle’s fund as an Investment
- In this case, assume I made profit of 10 lakhs, so I need to calculate the tax for full 10 laksh and the tax amount should be divided between me and my uncle or
- After dividing the profit amount assume 5 lakhs for me and 5 lakhs for my uncle. So I need to pay tax for my 5 lakhs profit with individual tax slab and the same applicable for my uncle.