Hi @Raj1
No, audit will not be applicable.
You can read about Tax Audit under Section 44AB of Income Tax Act - Learn by Quicko
@Shrutika_Shah Thank you so much for your valuable response.
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Sir, What do you mean by Cash Payment
Hi @JaiSriRam
Cash payment refers to an amount of money that has been paid or is expected to be paid in cash.
Hi
for FY 2023-24 (AY 2024-25)
If OPTION TRADING Turnover is between 2 to 10 Cr and if profit is less than 6 %, then Tax audit is applicable or not ?
I had never adopted in Presumptive Scheme.
no cash payment or cash receipt … only OPTION TRADING
Thanks,
Awaiting for kind reply.
Madam,Thanks for your prompt reply,
But all payments to broker is done through bank-Online.So what does cash payment mean. Sorry to ask further clarifications. I am only an engineer.
Madam,
I have Interest income of 4.5 lacs
My Loss in Intra day Trading in shares is 30,000
My F&O loss is 50,000
My Turnover- Absolute(Sum of Profits and Losses) is One crore.
Do I have to get it Audited. I was never in Presumptive Scheme.
No, a tax audit is not applicable if the turnover is ₹2 crores - ₹10 crores and the profit is less than 6% of the turnover (including loss), if presumptive taxation is not opted for.
Hi @JaiSriRam
Since you have F&O and intraday trading, you will be required to file ITR 3 as they are business incomes.
Also, in your case, an audit is not applicable as the turnover is less than 10 crore under the regular taxation scheme.
1 more thing require to clarify …
is UPI payment will considered as e transaction …
UPI payments are NOT CASH PAYMENTs.
Yes, UPI transactions are digital transactions and not cash transactions.
Hi,
I gone through a lot of articles and videos but unable to establish a few things about trading turnover and tax audit applicability. Following are my questions.
Trading Turnover - If I have both delivery and intraday transactions, since the treatment is different for both, how do I determine the trading turnover? E.g., Delivery Sales approx 91lakhs; Intraday Absolute profit is 9 lakhs. Should I add or treat the 2 separately for tax determination?
Tax Audit - For delivery based trading I have a loss of approx 5 lakhs which means that tax audit is applicable since it is a loss. Had I only had Intraday trading, since it is treated as business income, there would have been no need for a tax audit, is that a correct understanding?
Hi @tjain1977
Your understanding is right. The treatment for both of these are different.
The trading turnover calculation should be done only when the income from shares is considered as a business income (intraday) and not when it is considered as capital gain income(delivery).
For calculating the trading turnover for intraday you’re required to calculate the absolute profit. Here’s an article for your reference. Click here
Here’s a read about Tax Audit Applicability : Help Center. Tax audit is applicable to business income (i.e. intraday trading).
Hope this helps.
I have filed ITR - 4 for the last two years. My freelancing income has been under section 44ADA (presumptive) and F&O income under section 44AD as Business Income (presumptive). For this year, my turnover is about to exceed 2 cr (with profit above 6%).
Do I need an audit in this case?
Hey @Ksk02,
Yes, a tax audit will be applicable in this case.
Could you please explain the reason? As per the original post and the table provided, it seems like I would be covered under the 2 -10 cr category where audit isn’t applicable?
As per the rules of the presumptive taxation scheme, if you opt out of the presumptive taxation scheme before 5 years of opting in, you’ll have to get a tax audit done.
Hope this helps!
I am not opting out yet. I will be filing using presumptive taxation only due to my freelancing income too. Could you please clarify if an audit isn’t necessary in this case?
Hey @Ksk02,
For your business income, you will be required to opt out of presumptive taxation if the income exceeds the threshold. Hence, you will have to undergo a tax audit. You can still continue to opt for presumptive taxation for your professional income.
I want a conversation with Q&A team