Lets Understand the Tax P&L Report from Angel One

You can download the Tax P&L Report from Quicko’s tax planner on the tax P&L tab. The report includes details of segment wise trading – scrip name, buy value, sell value, and trading expenses. Segments included are – Equity Shares, Mutual Funds, Equity Intraday, Futures and Options.

Income Head – Capital gain covers gain or loss from the selling of Equity Shares (except intraday transactions), Mutual Funds (MF), Restricted Stock Units (RSU), Equity Traded Funds (ETFs), and Employee Stock Option Plans (ESOPs).

Business Income Head covers Equity Intraday transactions, Futures and Options. This Tax P&L Report can be used to prepare P&L A/C to report it in the Income Tax Return.

However, the trader must take care of the following things where the treatment as per Income Tax may differ:

Expenses

The Tax P&L Report covers transfer expenses that are directly related to trading transactions

The transfer expenses (such as brokerages, GST, transaction charges, STT, stamp duty etc.) are given separately under both Equity Shares. However, in the case of Mutual funds, the transfer expenses are included in Buy and Sell Prices

There are charges named as BKRSCR. Brkscr indicates all the brokerage expenses charged at the end of day, it cannot be segregated at scrip/trade level

In the case of Intraday and F&O, you can also claim other expenses – such as internet expense, legal fee, subscription expenses, depreciation, etc., which are not covered in the Tax P&L Report

Calculation of Long Term Capital Gains under Section 112A

LTCG on the sale of securities (on which STT is paid), bought on or before 31st Jan 2018 should be calculated using the Grandfathering Rule. As per this rule, the Cost of Acquisition is computed after considering the FMV as on 31st Jan 2018 as per Section 112A.

The FMV is not taken into consideration while computing LTCG for each trade in the Tradewise Tax P&L Report.

Calculation of Turnover

There are two different methods to calculate turnover for Intraday and Futures & Options:

• Scripwise Method: You calculate the turnover by collating all trades on the particular scrip for the financial year, find the average buy/sell value, and then determine the turnover
• Tradewise Method: You calculate the turnover by summing up the absolute value of profit and loss of every trade done during the year

You can learn more about scripwise and tradewise trading turnover calculation. 

1. Intraday

Trading in the stock market on a same-day basis. Thus, it would mean buying and selling on the same day itself.

Turnover 

For all intraday transactions, the aggregate or absolute sum of both positive and negative differences from trades is to be considered as a turnover.

Profit/Loss

Gross P&L is generally calculated by summing up overall sales amount reduced by buy amount.

Net P&L = Gross P&L – Transfer expenses

Here, Net P&L and Gross P&L shall remain the same as transfer expenses are adjusted in buy and sale values of respective scrips or trading transactions. Since transfer expenses are adjusted, transfer expenses are disclosed as NIL.

2. Futures & Options

In the Tax P&L report, F&O turnover and P&L is computed by considering the following trade segments:

• Equity Futures & Options
• Commodity Futures & Options 
• Currency Futures & Options

Turnover

For Futures transactions, Turnover = abs(sell value – buy value)

For Options transactions, Turnover = abs(sell value – buy value) + sell value

*abs() stands for absolute value

Profit/Loss

Gross P&L is generally calculated by summing up overall sales amount reduced by buy amount.

Net P&L = Gross P&L – Transfer expenses

Here, Net P&L and Gross P&L shall remain the same as transfer expenses are adjusted in buy and sale values of respective scrips or trading transactions. Since transfer expenses are adjusted, transfer expenses are disclosed as nil.

Corporate Actions

Transfer In/Out

If you moved your portfolio from another broker to Angel One or vice versa, your brokers will have partial data (either buy-side or sell-side depending on transfer in or out). Most of the brokers let traders enter such missing data. However, there are high chances of missing out Capital Gains arising out of such transfers. 

All of the above conditions are considered when you file your Tax Return using Quicko. However, reporting may vary depending on your specific situation, hence it’s always advisable to consult a tax professional when in doubt.

Buy Back Gains

When a company buys back shares issued by it from an existing shareholder, it results in capital gains for the shareholder. Such buyback gains would not be included in the Tax P&L Report.

As per a recent amendment in Budget 2019, the gains from buy-back are exempt in the hands of the individual since the company is now liable to pay the buyback tax under Section 115QA. This amendment is applicable to all the buybacks after 5th July 2019. Therefore, buyback gains before 5th July 2019 are taxable for the trader and the ones after 5th July 2019 are exempt.

We all know that the last few months have not been the easiest owing to the pandemic. Taking into account the difficulties that taxpayers could face while filing their returns, the Government has decided to extend the due date for filing ITR for FY20-21 as below:

Compliance	Due Date
Filing ITR where Tax Audit is Not Applicable	30th September 2021
Filing ITR where Tax Audit is Applicable	30th Novemeber 2021

However, if your net Tax liability is above INR 1 lakh, you still need to pay Self-Assessment tax before 31st July to avoid interest under section 234A.

What is Self Assessment Tax?

Self-Assessment tax refers to the outstanding tax dues that have to be paid by the taxpayer after considering TDS deducted and Advance Tax paid. In other words, it is determined after calculating total taxable income and subtracting deductions & taxes paid.

So does every individual have to pay Self Assessment Tax? Not exactly. Only taxpayers whose tax liability for a financial year exceeds taxes paid including TDS and Advance Tax have to pay this tax.

You can pay Self-Assessment tax by depositing it in a bank physically with Tax Challan. Or you can pay it online on the TIN NSDL website.

Taxpayers with Self Assessment Tax liability of more than INR 1lakh, have to pay their dues by 31st July 2021. A delay in paying the tax may attract interest under section 234A of the Income-tax Act.

Now, what about Advance Tax?

Any person whose Income Tax liability for the year is INR 10,000 or more is liable to pay Advance Tax. Now if you don’t pay your Advance Tax or pay less than 90% of the total tax liability, you will be liable to pay interest under section 234B. Under this section, you have to pay 1% interest per month (or part of the month) from April (beginning of the Assessment year) till the day you pay the tax.

Advance Tax has to be paid quarterly. The following table shows Advance Tax liability along with due dates

Due date of Instalment	% of Tax dues to be paid
On or before 15th June	15% of Tax liability
On or before 15th September	45% of Tax liability
On or before 15th December	75% of Tax liability
On or before 15th March	100% of Tax liability

In case you missed paying Advance Tax during the financial year, interest may be applicable u/s 234C

What if I miss filing ITR?

Failing to file your ITR within the due date comes with its repercussions. As already mentioned the government has extended the due date for filing ITR till 30th September for cases where Tax audit is not applicable. For cases where Tax audit is applicable, the ITR filing due date has been extended till 30th November.
However, if you fail to file your ITR by 30th September, then you will be charged a late fee under section 234F.

Under this section, a maximum fee of INR 10,000 can be imposed. For FY 2020-21 if ITR is filed after 30th September 2021 but before 31st December 2021 then a late fee of INR 5000 would be levied.

For returns filed after 31st December, a penalty of INR 10,000 would be levied.

The Income Tax department however has given some relief to the small taxpayers. For taxpayers whose total income does not exceed INR 5 lakh, the maximum penalty levied will be INR 1,000. 

The IT Department launched the new e-filing portal and with that major overhaul, third parties involved in the ecosystem need to update their systems to enable e-filing.

But fret not Quicko is all but ready to roll out some exciting features in the coming month. Get ready to file returns like never before!

Stay tuned!

Paying Income Tax might not be very exciting for most. We have been majorly conditioned into believing that paying Income Tax essentially means giving away a part of your Income. We rarely look at it from the perspective of investment. An investment for a better Nation. An investment for cleaner water, smoother roads and stronger infrastructure for the coming generations

On this Income Tax Day, let’s rewind a little and see what Income Tax Day is all about.

How did it begin?

The day actually has colonial roots. It starts with James Wilson, British India’s first finance minister being summoned to India, on November 28, 1859. He was called two years after India’s first war of Independence in order to look into the economic crisis that the colonisers were going through owing to increasing debt and military expenditure. In order to raise revenue, Wilson, an otherwise believer of the laissez-faire economy introduced the first “Income Tax” Act in February 1860. Irony died a silent death. This Act received assent on 24th July 1860, and hence, Income Tax Act was formally introduced in the country. Under this Act, Incomes were classified into:

• Income from landed property
• Income from professions and trade
• Income from securities, annuities and dividends
• Income from salaries and pensions.

The Act received huge backlash at that point in time. There was no doubt about the fact that it was simply another tool of exploitation. The Act was justified with the argument that since England is proving a secure and safe environment in India to carry on trade and other activities, they had the right to charge tax for that. White Man’s Burden has entered the chat.

Cut to post Independent India

The narrative around Income Tax completely changed post-independence. As a young nation, Income Tax became an instrument of nation-building rather than that of exploitation. The leaders of the country at that point had the humongous task of building a nation right from scratch.

The resources that they then collected through Income Tax became a major means through which they established hospitals, schools, universities and every other infrastructure required to make India a modern nation.

Establishing Income Tax Day

24th July 2010 marked 150 years of existence of this levy called Income Tax. To commemorate this levy which has been so instrumental in India’s development, from 2010 onwards, 24th July is celebrated as Income Tax Day.

On the 24th July 2010, the Income Tax Department held a function which was inaugurated by the then Hon’ble Finance Minister, Pranab Mukherjee. Many officers were awarded on that day and the official logo of the Income Tax department was also adopted.

Since then, Income Tax day is celebrated every year to appreciate the contribution of the taxpayers towards building and developing the country

Greetings on #IncomeTaxDay to the honest taxpayer & officials who’s contributions are accelerating our efforts towards economic development for an #AatmaNirbharBharat. Various reforms undertaken hv ensured every ₹ reaches its intended beneficiary.

|@IncomeTaxIndia @FinMinIndia|

— Anurag Thakur (@ianuragthakur) July 24, 2020

Saluting all taxpayers on #IncomeTaxDay2020. Your honest contributions have brought the nation this far! Let us continue to work together to build this great nation. #IncomeTaxDay #YourContributionMatters #NationBuilders@nsitharamanoffc @Anurag_Office @FinMinIndia @PIB_India pic.twitter.com/P6iZmR7v7s

— Income Tax India (@IncomeTaxIndia) July 24, 2020

It is no secret that a large chunk of the Indian population doesn’t pay taxes. But is it because all Indians are hiding away their cash in some sneaky corners? Well, the truth is far from that. In India, many fall below the basic tax exemption limit due to which they don’t have to pay tax.

This shouldn’t necessarily be taken as an indicator of slow development as the amount of tax collected by the government is increasing with every fiscal year.

At Quicko we understand that for the uninitiated taxes can be quite overwhelming. So we are here to make the conversation around taxes untaxing for everyone.

Filing taxes has always been difficult for traders and investors. Well not, if you are an Axis Direct trader or investor, you are at the right place! Axis Direct has partnered with Quicko to simplify taxes for you.

After you log on to Quicko’s Tax Planner, under the Tax P&L tab, you can directly upload your Axis Direct Tax P&L Statement and get started.

Steps to Download Axis Direct Tax P&L Report

• Login to Axis Direct 
• Nevigate to Portfolio > Click on Reports > Capital gain and loss statement
• Select ‘Direct Transactions‘ & Select the year for which you want to calculate.
• Click on Go & Download the report

Choose the correct financial year and drop your Tax P&L statement to upload it on the Tax Planner App.

All your trades will be imported, categorized under the right income heads of capital gains or business income as per Income Tax Act along with turnover, P&L, LTCG, and STCG. Moreover, you can view your trades in a tradewise or scripwise manner by selecting your option to view the data. Here’s how the P&L will be classified under the income heads:

Capital Gains Head

Income Head – Capital gain covers gain or loss from the selling of Equity Shares (except intraday transactions), Mutual Funds (MF), Restricted Stock Units (RSU), Equity Traded Funds (ETFs), and Employee Stock Option Plans (ESOPs).

LTCG will be computed by applying grandfathering rule as per section 112A under the following asset types:

• Shares/ESOP/RSU
• MF/ETFs (Equity)

GrandFathering Rule for LTCG

The cost of acquisition to compute the LTCG on the sale of equity shares, equity-oriented MFs & ETFs shall be calculated by using FMV as on 31.01.2018.

Under the Equity segment – ‘Shares/ESOP/RSU’ of the Tax P&L Report, the Buy Price would be computed after considering FMV as on 31.01.2018 and the LTCG will  be calculated as a difference in sales value and buy value. While for Mutual Funds, cost is not calculated after considering FMV. However, the FMV would be separately provided for ITR reporting purposes.

Transfer Expenses under Capital gain

The transfer expenses are included in Buy Price and Sell Price under both Equity and Debt segments. 

BuyBack & Dividend Transaction

Buyback of shares and Dividend transactions would not be included under the Equity segment in the Tax P&L.

Business Income Head

• Equity Intraday:
  • Trading in the stock market on a same-day basis. Thus, it would mean buying and selling on the same day itself
• Intraday Turnover:
  • For all intraday transactions, the aggregate or absolute sum of both positive and negative differences from trades is to be considered as a turnover
• Intraday Profit/Loss:
  • Gross P&L is generally calculated by summing up sales amount reduced by buy amount
  • Net P&L = Gross P&L – Transfer expenses
  • Here, Net P&L and Gross P&L shall remain the same as transfer expenses are adjusted in buy and sale values of respective scrips or trading transactions
  • Since transfer expenses are adjusted, transfer expenses are disclosed as NIL
• Futures & Options:
  • In the Tax P&L report, F&O turnover and P&L is computed by considering the following trade segments:
    • Equity Futures & Options
    • Commodity Futures & Options 
    • Currency Futures & Options

There are two different methods to calculate turnover for Intraday and Future & Options:

1. Scripwise Method: You calculate the turnover by collating all trades on the particular script for the financial year, find the average buy/sell value, and then determine the turnover

2. Tradewise Method: You calculate the turnover by summing up the absolute value of profit and loss of every trade done during the year

You can learn more about scripwise and tradewise trading turnover calculation. 

• F&O Profit/Loss:
  • Gross P&L is generally calculated by summing up sales amount reduced by buy amount
  • Net P&L = Gross P&L – Transfer expenses
  • Here, Net P&L and Gross P&L shall remain the same as transfer expenses are adjusted in buy and sale values of respective scrips or trading transactions
  • Since, transfer expenses are adjusted, transfer expenses are disclosed as NIL

Then, proceed to the ‘Tax Planner‘ tab, where you can enter all of the important information for your case, for income situation & Advance Tax both.

Once you have filled up the necessary information on the ‘Tax Planner’ tab, navigate to ‘Tax Returns’ tab to continue  your taxes for the given assessment year. Here, review your tax planning information and click on ‘Prepare ITR‘ to prepare and file your return.

Once you have clicked on ‘Prepare ITR’, you will be redirected to the Tax Filing App on Quicko.

Know the Steps to File ITR on Quicko.

That’s it, taxes are going to be super simple for Axis Direct Traders!

While the struggles of being engineers and civil servants are well documented, we kind of tend to overlook the ones who come to our rescue when it comes to taxes and finance.
Yep, we are talking about our last-minute saviours the Chartered Accountants. Oh! And before we proceed, let us remind you that 1st July i.e. today is 72nd Chartered Accountant’s Day.

What is CA day?

Well, CA day is celebrated every year to commemorate the finding of the Institute of Chartered Accountants of India. The institute was founded by the parliament of India in 1949.
Trivia time: ICAI is in fact India’s national professional accounting body. It is also the second-largest accounting organization in the world.

What does it mean to be a CA?

Being a CA is definitely not a walk in the park. As our in-house CA Kaushal Soni says, “It takes so much hard work, sacrifices and consistency to achieve the precious prefix called “CA”. Check out his ode dedicated to every member of the CA fraternity.

The responsibilities of a CA includes everything from auditing financial statements to filing corporate tax returns and not to mention keeping up with the unending extension dates.

Since it is such a high stake profession, the road to becoming a CA is not easy as well.
Here’s the mountain that they have to climb in order to become a CA
1. Clear CA Foundation course (previously known as CPT or Common Proficiency Test)

2. Complete CA Intermediate (previously known as IPCC or Integrated Professional Competence Course)

3. Complete and clear Integrated Course on Information Technology and Soft skills 

4. Complete 3 years Articleship 

5. Complete Advanced Integrated Course on Information Technology and Soft Skills (AICITSS)

6. Complete and clear the final course

Phew! This surely is a looooong road. 

A CA is expected to follow the ICAI’s regulations to the last letter. They play a huge role in the economy by keeping track of the flow of money for businesses and individuals.

From filing our returns on time giving us content for making memes, CAs are truly the best and we would like to thank them for always having our back. Here’s to wishing all the Chartered accountants, A VERY HAPPY CA DAYYY!!!!🎉🎊

Hey, before you go, are you a Tax enthusiast? Does the concept of combining technology with taxes intrigue you? Well, if yes why don’t we partner up and make taxes simple for everyone!!!