List of Expenses a Trader can claim

can the salary vary each months ?

Hi @HIREiN

Practically, salaries don’t vary so much.
However, minimal variations is fine.

Can I claim expenses like Monitor / printer ? if yes, is that going to be full price claim or depreciation like computer/laptop?

Hi @SaratP

You can claim the depreciation on such devices if they have been used for your business.
Depreciation is applied at full rate if the asset is used for more than 180 days in a year otherwise at half rate.

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If we’ve shown STT, Transaction charges, Stamp Duty, GST, etc as ‘Direct Expenses’ (since we’ve to show Turnover from ‘Sale of Options’ under Revenue from operations) to get our ‘Gross Profit from business’ which is our true profit left with us.

Can we still claim STT, Transaction charges, Stamp duty under ‘Profit and Loss Account’ as expenses also?

For example, after paying all charges through broker the amount left is Rs10,00,000 and Rs2,50,000 is paid as brokerage, stamp duty, GST, Sebi charges,etc and Gross Profit shown by broker is Rs12,50,000. So can we claim all those expenses to reduce our taxable income to Rs7,50,000. Can you please help on this?

Hey @delta,

You can claim the expenses only once, i.e. if you have made profits of ₹12,50,000, you can deduct the expenses incurred in the form of STT, stamp duty etc, and pay tax on the net profit that will be ₹10,00,000.

Hope this clarifies.

Hello,

But our Net Profit is only Rs10,00,000 which we get after, so even the person who doesn’t understand claiming expenses he’ll write Rs10,00,00 as its Profit earned, so those STT, Brokerage, Transaction charges,etc claiming won’t give any benefit, those are already deducted from contract note (including brokerage).

Hello @delta

Yes, You are supposed to pay taxes on Net profit of business income. You can claim the expenses only once. However, you can claim other allowable expenses apart from STT, stamp duty, brokerage etc. incurred for business.

Hope this helps!

Hello!
I am a salaried individual with income from options. I bought a car and mobile phone, and wanted to check if its possible to claim depreciation on it. Thanks!

Hey @Sushant,

Trading in options is considered as business. You can claim depreciation on assets if they were purchased for your business, which is trading in this case.

Hi, my income is from derivatives trading in my personal account. My husband is helping me with trading and the trading account is managed by my husband. So, from my profits can I pay my husband a fee/consulting charges etc. for managing my trading account and mark this as expense related to trading activity?.

Hey @myth1718,

Yes you can claim it as an expense. However, the charges paid to the husband need to be reported by him in his ITR as income.

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Hi, what is the limit above which it needs to be reported? I am paying my wife salary of 30000 per month, so 3.6Lakhs, not taxable in default new regime. Should my wife still report it?
Also, I do a quarterly transfer of 90000 for 3 months. Would those transactions be sufficient as proof or any other complications like adding her PAN while filing my ITR, deducting TDS, etc? Thanks. @Surbhi_Pal @AkashJhaveri

@Surbhi_Pal @Muskan_Balar
Let’s say if I purchase an office on loan OR without loan for the sole use of trading. Can I claim it as an expense & interest component also can be claimed?
and what about other expense like furniture desk laptop & monitors ?

Hey @rakesh1816,

If you have taken the office on loan, you can claim the interest as an expense. Moreover, on assets like laptops and monitors, you can claim depreciation.

Hope this helps!

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Hi. I just came accross this thread on this websit.

Commodities Trading is considered to be a Non-Speculative Business Income. Thus, a commodities trader must file ITR-3 to report such business income and pay income tax at slab rates. Further, as per the Budget Speech, trading in commodity derivatives is not a speculative transaction and the trader can claim CTT as a valid business expense.

Can you explain it further. Suppose I have income from equities, some other business income as well as some income from commodities. How would I go about it ?

Rgds

Hey @Dr_Gaurav_Kakkar,

Yes you can claim commodity transaction as as expense while reporting your trading business.

Here, your profits from equity shares will be treated as capital gains and further, you will have to report both your businesses. Commodity trading will also be reported as business income and you can claim various expenses incurred with respect to the same. This includes any taxes paid such as STT (Securities Transaction Tax), Stamp duty, CTT etc.

Hope this helps!

Traders can claim various expenses as deductions in their Income Tax Return (ITR), including office rent, insurance premiums, office supplies, repairs and maintenance, legal fees, depreciation, trading expenses, mobile and internet expenses, finance expenses and other business expenses. the Associated costs. These deductions help reduce your taxable income, but personal expenses, penalties, interest and some taxes are not deductible. Keeping accurate records is critical to eligibility for the deduction.