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Intraday Trading

How are profits on Intraday trading taxed?

Gains from intraday trading are classified as speculative business income under Indian tax law. These gains are taxed according to your income tax slab rate, which ranges from 5% to 30%, depending on your total taxable income.

Unlike long-term investments, intraday trading gains do not benefit from capital gains tax exemptions. It is essential to maintain detailed records of your intraday trades for tax filing purposes and report the gains accurately.

Losses from intraday trading are called speculative business losses and can be carried forward up to four consecutive financial years. The said losses can be set off only against the speculative income and not against the any other income like normal business income or capital gain etc.

Let’s understand with this an example
Here are the income details of a 30-year-old intraday trader:

Annual Salary = ₹10 lakh
Income from intraday equity trading for the year = ₹2 lakh [speculative business income]

Given these income tax will be calculated as below

Total taxable income would be calculated by adding all the income heads like Salary and speculative income therefore the total income will be:
Total income = 10,00,000 (Salary) + 2,00,000 (Speculative income)
= 12,00,000
Hence, the trader has to pay income tax on ₹12 lakh. Based on the tax slabs.

What is Intraday Trading? How does “Intraday (Margin)” work? How is Intraday trading different from trading in Cash Segment/ Delivery? What is the Margin required to take a position in Intraday Product? What is Initial, Minimum Margin and Trigger price? What happens if the margin is less? Can I convert an intraday position to delivery? If so, how? What is short selling in Intraday trading, and how does it work? How can I “Square Off” a position? Can I modify intraday position? How? What are the options for “order validity”, “disclosed quantity”? Where can I see them? What is “Limit order”? How to place a limit order? What are Initial and Minimum Margins? What happens if the margin falls below the required level? How to place an Intraday order? When will the profits from Intraday trading be added to my current limits? Why are my profits from intraday are not available in current limits? What is trigger price? Where can I check trigger price for Intraday position? What happens to my intraday position if the stock hits circuit limits? How do I add Margin to my Intraday position? What is the brokerage charged for Intraday? What time does the intraday day position get squared off? Will my Intraday positions get squared off due to margin shortfall? What effect will it have on my position? By what time can the positions be converted to delivery? What happens if my Intraday Buy/Sell position is not closed at the end of the trading day? Where client has undertaken multiple transactions in a single stock on the same day under Intraday product, which intraday trade leg will be considered if client has placed CTD (Convert to Delivery) request and how will the brokerage computation take place? What is Day’s Profit & Loss on website open position page? Where can I access intraday Day’s Profit & Loss? What will I see in Day’s P&L on Equity Open positions page for Intraday & Bracket? How it is helpful? Why can’t I see Overall P&L on the website open positions of Intraday & Bracket anymore?

Bracket Order

What should be the Stop Loss Trigger Price in different situations? How do I place a Bracket order? What is a Cover SLTP order and how does it work? Why am I getting the error “Bracket trading not supported for the stock”? How do I see the stock list for eligible stocks? How is Bracket different from Intraday Margin? Where do I modify an SLTP order? What is a Profit order and how does it work? How do I place it?

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