F&O Tax (Futures and Options)
Definition
F&O income is classified as Non-Speculative Business Income and taxed at the individual's applicable slab rates (5%, 20%, or 30%), NOT as capital gains at flat rates.
In Context
F&O traders must file ITR-3 (not ITR-2 or ITR-4). Business expenses (brokerage, subscriptions, software) are deductible under Section 37. Losses can be carried forward for 8 years against future business income.
Related Terms
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