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Essential Documents for Filing Income Tax Returns on Income Earned from Trading in Shares and F&O Markets Tips from Alliance Tax Experts

When it comes to income earned from trading in shares and F&O markets, it is important to have all the necessary documents in place to ensure the smooth filing of income tax returns. Here are the documents required:

1.    Contract notes: A contract note is a legal document that serves as proof of the transactions carried out in the stock market. It includes details such as the date of the transaction, the number of shares traded, the price at which the transaction was carried out, and the brokerage charges.

2.    Bank statements: Bank statements are essential for calculating the total income earned from trading in shares and F&O markets. They provide a record of all the transactions carried out in the bank account, including deposits and withdrawals.

3.    Demat account statement: A Demat account statement provides a summary of all the shares held by the individual in electronic form. It includes details such as the name of the company, the number of shares held, and the purchase price.

4.    Profit and loss statement: A profit and loss statement provides a summary of the total income earned and expenses incurred from trading in shares and F&O markets. It includes details such as the total revenue earned, brokerage charges, and other expenses.

5.    Tax deduction at source (TDS) certificate: A TDS certificate is issued by the employer or the deductor, and it serves as proof of tax deducted at the source of the income earned. It includes details such as the name of the deductor, the amount of tax deducted, and the date of deduction.

6.    Audit report: If the turnover from trading in shares and F&O markets exceeds the prescribed limit, it is mandatory to get the accounts audited by a chartered accountant. The audit report helps in verifying the accuracy and correctness of the financial statements.

7.    Challans: Challans are receipts issued for payment of taxes. They serve as proof of payment of taxes and are required for filing income tax returns.

In conclusion, having all the necessary documents in place is essential for filing income tax returns related to income earned from trading in shares and F&O markets. Make sure to maintain proper records and keep all the documents handy to avoid any last-minute hassles.

Author

Santosh P

Founder & Director

Alliance Tax Experts

9769201316

santoshpatil@alltaxfin.com

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