Hi @TeamQuicko
I invest regularly in shares and have both long term and short term capital gains. I file ITR 2 every year.
However, in the last financial year I have done just a single Intraday Trade. The profit from this intraday trade is around 3500.There are no Future & Options trade and I have no other business income.
Am I required to file ITR 3 for this single intraday trade ? Will it be allowed if I show this profit of 3500 as a short term capital gain and file ITR 2 ?
Yes, even a single intraday trade creates a tax liability, and therefore, filing ITR 3 becomes necessary. Many traders mistakenly believe that only frequent or high-volume trading requires filing this return. However, as per the Income Tax Act, even one intraday trade is treated as a business income event.
Hereās why it matters:
Intraday trading income is considered speculative business income. That means you canāt file ITR-1 or ITR-2 for such incomeāyou must file ITR 3.
Failing to disclose even a single trade may attract penalties, notices, and scrutiny from the Income Tax Department.
Proper filing ensures you can claim expenses (like brokerage, internet, or advisory charges) and possibly reduce your taxable income.
It builds a clean financial record that helps in loan approvals, visa applications, and future compliance.
Thanks @Pranab63 for your reply.
I have gone through the ITR 3 and it seems I just have to enter the Intraday Turnover and Intraday Income of 3500 in 12a & 12b respectively in Trading Account Section in ITR 3. Since I have no other business income, then P&L Account & Business and Profession sections will be filled automatically and I have nothing to enter regarding this income anywhere else.
However, I have a confusion regarding filling up the Balance Sheet section. Do I have to show this 3500 profit in Balance Sheet ? If yes, then where should I show it ? There is a section in āApplication of Fundsā - ā4c Profit and loss account/Accumulated balanceā - should I show it here ? But this option seems to be filled only when I have a loss from P&L account.
Also, how can I determine the āProprietorās capitalā in āSources of fundsā ? The amount of around 5 lakh that I have with my broker is used for buying and selling shares for capital gains. How can I separate what capital I actually used for business ? And also, where should I show it in āApplication of fundsā ?
Can you kindly help me in this regard @Pranab63 ? @TeamQuicko ?
You can simply enter Cash & Bank Balance in Source of Funds & the same amount shall be reported in Application of Fund.
Once you enter Intraday transaction in 12(a) & 12(b) , it is not required to be reported again in P& L Account.
Thanks @anitabhadra for your reply.
Since I donāt have any current/business account, so can I just enter the balance as on 31st March I have in my Personal Savings Account in āApplication of Fundsā and report the same in Proprietorās capital in āSources of Fundsā ?
Also, I shall be highly grateful if You kindly clear my doubts about the following 2 things -
The āReserves and Surplusā section in āSources of Fundsā - Can I just leave it blank ? Or is it required to enter my profit here under āAny other Reserveā ?
The section āApplication of Funds - 4c Profit and loss account/Accumulated balance" - Is this to be filled only when I have a net loss from P&L Account ? Letās say if I had a loss of 3500 from Intraday, would I then put it here and enter 3500 in Proprietorās capital and then both side of my Balance Sheet would show amount of 3500 ? So, in that case it would not be required to enter my bank or cash balance - am I correct in understanding this ?
Kindly reply if possible @anitabhadra as this would clear all my confusion regarding this.
Got it now. Thank You @anitabhadra