Page Contents
| Situation | Applicable ITR | 
| Regular reporting (with books) | ITR-3 | 
| Opting for presumptive taxation (Sec 44AD) | ITR-4 | 
Step 1: Calculate Turnover
Step 2: Claim Business Expenses (If not using presumptive)
Step 3: Set Off and Carry Forward Losses
| Type of Loss | Set Off Against | Carry Forward Period | 
| F&O Losses (Non-Speculative) | Any income except salary | 8 years | 
| Intraday Losses (Speculative) | Only against speculative income | 4 years | 
Under Section 44AB:
| Criteria | Audit Requirement | 
| Turnover > INR 10 crore | Audit mandatory | 
| Turnover between INR 1 crore – INR 10 crore and cash transactions >5% | Audit mandatory | 
| Turnover ≤ INR 2 crore, profit <6%, opted out of 44AD in last 5 yrs, total income > exemption limit | Audit mandatory | 
| Declaring ≥6% profit digitally under Sec 44AD | No audit required | 
Yes, F&O traders must pay advance tax if their total tax liability exceeds INR 10,000 in a financial year, in four installments (15 June, 15 Sept, 15 Dec, 15 Mar). Taxpayer required to maintain books of accounts. Consider auditing requirements (if turnover > INR 10 crores or profit < 6%/8%). Use Form 3CD + 3CB or 3CA if audit is applicable.
Maintain:
| Criteria | Old Regime | New Regime | 
| Business expense deduction | Yes | No | 
| 80C/80D deductions | Yes | No | 
| Reversal | Can revert anytime | Can switch back only once in lifetime (Form 10-IEA) | 
| Question | Answer | 
| Do I have to file ITR for F&O even if in loss? | Yes, especially to carry forward losses | 
| Is Tax Audit mandatory? | Depends on turnover, profit %, and mode of transactions | 
| Can F&O losses be carried forward under new regime? | Yes, only if ITR is filed on time | 
| Which business code to use? | Use Code 09001 – Trading in derivatives (F&O) | 
| Can F&O traders use presumptive taxation? | Yes, if turnover ≤ INR 2 crore and opting for Sec 44AD | 
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