Can loss under F&O trading be reimbursed?

– B Mahesh Kumar Singh

Income/loss due to futures and options (F&O) trading can be treated as business income or capital gain (based on a detailed examination of factors such as trading volume, frequency of transactions, average holding period, method of financing , says Central Board of Direct Taxes (CBDT press release dated 24 August 2019 etc). In the present case, it is held that the income/loss on account of futures and options trading is treated as profit and gain of business or profession.

As per the provisions of Income Tax Law, any expenditure incurred wholly and exclusively for the purposes of business can be claimed as deduction from business income.

Accordingly, if the specified expenses are solely and exclusively for F&O trading, it can be claimed as a deduction against business income. Where any expense (such as software) is capitalized, depreciation as determined may be claimable against business income.

Further, loss from business can be adjusted against taxable income under any head of income (other than salary income) during the same financial year (financial year). Accordingly, in the instant case, the current financial year loss from F&O trading can be adjusted against the dividend and interest income of the current financial year.

Further, depending upon the turnover/gross receipts/income of business, nature of business, applicability of tax rates (normal or estimated tax rates), applicability of GST and compliance thereunder, maintaining books of accounts and conducting tax audits. will need to be done for evaluation.

I am working in an IT company which works 5 days a week. I have received an offer letter today. The notice period for serving in this company by me is 2 months. If I give notice, by the time it is released, I will be able to complete 4 years 195 days. So, am I eligible for Gratuity?

– to Prasannaanjaneyulu

As per section 4 of the Payment of Gratuity Act, 1972 (‘the Act’), an employee is eligible for gratuity if an employee has rendered continuous service of not less than 5 years.

Further, as per section 2A of the Act, an employee is said to be in continuous service of one year if the employee has worked under the employer for not less than 190 days (in case of establishment which works 5 days a week). is) / 240 days (in case of establishment which operates 6 days a week). Assuming that you are completing 4 years 195 days service and your company works 5 days a week, thus you should be eligible to get gratuity.

Parizad Sirwalla is Partner and Head, Global Mobility Services, Tax, KPMG in India.