ITR Filing for F&O and Intraday Traders
F&O and intraday trading are treated as business income under Section 43(5) and filed in ITR-3. Turnover computation uses absolute-profit-and-loss method; tax audit applies if turnover exceeds ₹10 Cr (digital) or losses are declared without 6% profit.
- Correct form: ITR-3 (business income)
- Regime: Old regime often better due to Section 44AB audit-linked deductions.
- Reconcile AIS + 26AS before filing to avoid 143(1)(a) intimations.
- Aadhaar OTP e-verification the same day.
- Free notice defence within 12 months of filing.
Definition
44ADA
Definition
44AD
Definition
Section 44AB
Typical income mix for traders
- F&O trading turnover
- Intraday equity turnover
- Delivery equity (capital gains, ITR-2 items)
- Commodity / currency trading
- Dividend and interest income
Deductions available
- Section 80C — ELSS, PPF (₹1.5L)
- Section 80D — health insurance
- Section 80CCD(1B) — NPS ₹50k
- STT, brokerage, internet, DEMAT AMC (business expense)
- Depreciation on trading laptop / setup
Documents required
- Broker profit & loss statement (Zerodha, Groww, Angel)
- Contract notes summary
- Bank statements
- STT / brokerage certificates
- DEMAT holding statement
- Ledger from broker
Common mistakes to avoid
- Filing F&O in ITR-2 as capital gains — return defective
- Not computing turnover correctly under 43(5)
- Skipping tax audit when loss is declared (44AB)
- Missing STT and brokerage as deductible expense
- Ignoring intraday profits shown separately from F&O
Worked example
A Mumbai F&O trader with ₹3.5L loss and ₹18L turnover files ITR-3 with Section 44AB tax audit — Taxpex carries loss forward 8 years under Section 72.
Traders — filing snapshot
| Item | Detail |
|---|---|
| Recommended form | ITR-3 (business income) |
| Regime guidance | Old regime often better due to Section 44AB audit-linked deductions. |
| Presumptive available | Depends on income mix |
| Audit trigger | Above threshold or below deemed profit |
| Taxpex turnaround | 24–72 hours |
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Frequently asked questions
Frequently asked questions
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Related tools, guides & services
Related reading
- Which ITR Form Should You File in 2025? Complete Guide (ITR-1 to ITR-4)
- Which ITR Form Should You File in 2026? (ITR-1 to ITR-7 Explained)
- ITR Filing Last Date FY 2024-25 (AY 2025-26) — Complete Guide
- Top 15 Mistakes to Avoid While Filing ITR (And How to Fix Them)
- Form 16 and 16A Difference — Full Comparison (2026)
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