Calculation of Trading Turnover

Importance of Turnover Calculation Crucial for Tax Audit determination. Ensures compliance with tax regulations. Understanding Turnover Calculation Different methods based on trading type. Tradewise and Scripwise methods commonly used. Tradewise Turnover Sum of absolute profit for each trade. Example: Calculate absolute profit for each trade, then sum.

Scripwise Turnover Sum of absolute profit for each scrip traded. Example: Calculate net profit or loss for each scrip, then sum. Turnover for Equity Intraday Trading Calculated as absolute profit. Example: Calculate absolute profit for each trade and sum.

Turnover for Equity Delivery Based Trading Sale value used for turnover calculation. Example: Sum of sale values for all transactions. Turnover for Futures & Options Trading Absolute profit considered for turnover. Example: Calculate absolute profit for each transaction and sum.

Note on Options Trading Turnover calculation revised as per updated guidelines. Conclusion Accurate turnover calculation aids in tax compliance and ensures proper assessment for Tax Audit requirements under the Income Tax Act.