Tax on online stock trading for salaried..?

Pt 1: I did stock-trading for sometime, which had significant losses. I want to show these in my IT returns properly, so that I can carry the losses forward in appropriate manner.

To set the context, I have been informed about between three types of handling income on stock trades - speculative, short term capital gain / losses and trading gains / losses, with the definition being -
- speculative - any trading done on the intraday basis without delivery
- short term capital gain - trading of duration less than a year with objective of investment
- trading gain - for trading duration less than a year with trading objective
In the above I am relying on information from - http://taxworry.com/whether-purchase-and-sale-of-share-through-demat-account-is-stcg-or-speculation/
Is trading income to be taken as the business income. In that case can loss therein be adjusted against other income like from salary.

Pt 2: When can i classify a trade as trading income vs a short term gain. Is there any guideline. Is there any issue in showing the loss as trading loss rather than short term capital loss.

Pt 3: How do I identify a speculative trade vs a trading gain, is it just the aspect of delivery of shares on Demat. What information do I need to get from my online trading firm to differentiate between these. Can I take a simple guideline of any trade closed in 2 days to be taken as speculative. Of course this problem does not arise if I can use one figure for both in the It returns

Pt 4: In Future and Options trading, my understanding it that it is considered as business income, no matter the duration of trade. This is based on the following - http://taxworry.com/future-trading-is-business-activity/

Pt 5: Can I carry forward losses in all types of trade for next 8 years -
- Speculative Trade loss
- Short term capital loss
- Trading loss on stock trading
- Business loss on Futures and Options

Pt 6: Which all expenses out of following can be adjusted in the losses from trading. Is this uniform for both short-term stock trading and futures and options trading?
brokerage, service tax, stamp duty, Education cess and Higher Edu cess

Pt 7: Can I adjust STT as well when computing losses for both stock trading and futures and options trading. My understanding is I can unless it is for long-term capital gain.

Pt 8: My assumption is that I need to fill the ITR-4 form for this type of case.

Pt 9: As a salaried person, in ITR-4 excel utility (as provided on IT dept efiling site) do I need to fill up sheets on nature of business and brand name etc.

Public Comments

1. Hire a tax consultant

2. 1. you can rely.

2. you have to show accordingly. intraday- speculative, < one year- short term, > one year- long term.

3.you can collect this information from your broker. he will give you a statement.

4. right

5.all expenses.

6. Please check with guidelines or CA

7.Please check with guidelines or CA

8. You are right

9. You are right.

Over and above. I will suggest please go to the CA. He will help you in better.

Tulsi Gupta