Which ITR Form to File for Intraday Trading?:

Are you an intraday trader and wants to know how to file ITR and which one?

Then don’t worry through this article on “Which ITR Form to File for Intraday Trading?” has all the answers that is in your mind regarding the ITR.

As a trader, you need to file the income tax return filing for both the equities and intraday trading.

It depends on individual to individual for deciding what type of trading they are choosing for trades and with accordance to that you need to file the ITR form.

For every instruments there are different forms for ITR to file like it could be Equity, Mutual Funds, Intraday, and Futures & Options etc.

The taxpayer needs to report incomes, calculate and need to pay the taxes, claim the TDS Credits and can also request for the overpayment of the taxes while their ITR.

For the traders that are earning income from the financial investments need to file ITR-2 or ITR-3 that will be based on the nature of income from the type of trading.

In case of any capital gains income then file ITR-2 and in the case of business income then you need to file ITR-3.

Depending on the different income situations there are different ITR forms available by the income tax department.

A trader can use the ITR form calculator to know which ITR form is applicable for them.

Now let us see the different ITR forms and understand them in depth.

ITR-2 for the Equity Investors or Traders

ITR-2 is applicable for the individuals and for Hindu Undivided Family (HUF’s) that have capital gains in the given first year.

Income that comes and based on the Delivery based Equity trading and trading in Mutual Funds these are classified as Income from Capital Gains.

If an Individual/ HUF has earn income from the Capital Gains but has been opted for the Presumptive Taxation Scheme for business income then he/she required to file the ITR-3 without preparing the financial statements.

The due date for filing the form of ITR-2 is 31st July for the assessment year.

So, this was all about the ITR-2 filing and its norms.

Now let us get knowledge about the taxation part for this.

Taxation

In the case for the equities and equity mutual funds, the Long-Term Capital Gain above Rs. 1,00,000 then the taxation rate is applicable on it is for 10% whereas under the 1 lakh the taxation is free.

And for the Short-Term Capital Gains the taxation rate is 15%.

If the assets in other cases are holds different asset in Debt Mutual Funds Category then the taxation rate is different:

  • In Long-Term Capital Gains for the debt mutual funds are taxed at 10% without the indexation or 20% with Indexation; from this whichever is lower.
  • While for the Short-Term Capital Gains they are taxed at the slab rates.

Now let us move on to know about another ITR form.

ITR-3 for Intraday and F&O Traders

The individuals or the HUF’s earns income form the profit and gains from the business or as a profession then they need to file the ITR-3 form.

In these, there are different types of traders comes with different income sections like:

  1. Equity Intraday Trading
  2. Equity F&O Trading
  3. Currency Trading
  4. Commodity Trading

For this type of trader, they need to prepare the P&L statement and the balance sheet for filing the form of ITR-3.

In this the books of financial accounts needs to be audited before filing the ITR form.

Business Income or trading income under ITR-3 is taxable as per the slab rates.

There is one form of ITR for the traders if they have opted for the Presumptive Taxation Scheme, let’s check out that also.

ITR-4 for Traders that opted for Presumptive Taxation Scheme

The individuals or the HUF’s firms that have the total income up to 50 Lakhs need to fill the form of ITR-4 that has opted for presumptive taxation scheme under the section 44AD, 44ADA or 44AE.

The trader earns the income from the intraday trading, F&O trading, Commodity trading, and the Currency trading are these income are considered as Business Income.

The trader further has the options to choose the Presumptive Taxation scheme if they fall under these conditions like:

  • The turnover should be up to Rs 2 Crore
  • The profits need to be more than or equal to 6% of the trading turnover.

If the trader choose the presumptive taxation scheme, they don’t require to get the auditing of their books of accounts and can file ITR-4.

But if the trader has opted the presumptive taxation scheme for the business income and also earns income from Capital Gains they the trader needs to file ITR-3 in this case.

“ITR Website

Conclusions

Through this article on “Which ITR Form to file for Intraday Trading?” we had already defined you all the ITR Forms for the trading purpose not only the intraday trading but also the other securities. We had made it clear that if you are in any of the situations that are mentioned above then you can get to know what ITR Form you need to file. Be a trustworthy citizen and pay the taxes according to the ITR Slabs.

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Author

Prashant Raut is a successful professional stock market trader. He is an expert in understanding and analyzing technical charts. With his 8 years of experience and expertise, he delivers webinars on stock market concepts. He also bags the ‘Golden Book of World Record’ for having the highest number of people attending his webinar on share trading.