Audit u/s 44AB of the I. T. Act

[Kishor Deshpande]

One of my client is dealing in shares. However, he is doing his share transactions on delivery basis, intraday basis and f&O basis. So, for the sack of consideration of turnover for the purpose of audit u/s 44AB  of the IT Act, how the turnover is considered for all the above mentioned three types of transactions.

AI Summary

Clarifying Turnover Calculation for Share Transactions: Section 44AB Guidance on Delivery, Intraday, and F&O Trades A client involved in share transactions seeks clarification on calculating turnover for audit purposes under section 44AB of the Income Tax Act. The transactions include delivery-based, intraday, and futures and options (F&O) trades. One response suggests considering delivery-based transactions using sale and purchase prices, while non-delivery transactions should use price differences. Another response advises treating delivery-based transactions as capital gains unless turnover is high, in which case they may be classified under business income. Intraday transactions are speculative, with net sales as turnover, and F&O transactions should calculate turnover based on net gains and losses.