Sir, I wd like to give you round lot of applause and thanks internally for providing such a fantastic article on derivatives. Really it was marvellous & informative too, what i feel
I would appreciate if someone could shoot a scrap for my doubt as to how to pay the Tax on Futures? Will it be deducted from source or we need to pay later? thanks in advance
RE:tax paid for profits made in futures
by on Jan 03, 2008 12:33 PM
just wanted to know that if i earn Rs 1,00,000 in futures during 1 financial yr and if this the only source of income i have ... do i still need to pay that 33% or 10% tax on it kindly confirm. thanx in adcance
yes, the absolute amount is the same but while looking at losses, it is usual to consider the relative loss. In the above example, if you bought futures worth Rs 6lakhs, you would have lost approx. Rs 5.5 lakhs. While in the basic equity trading, you lose out just Rs. 55K! Hope that helps.
Also, does anyone know of any private companies trading futures in India? which all Investment Banks are dominant in futures/options trading?
In the example you gave in the last section, the loss in Futures is 92%. But in fact, the total cash loss is 50,000 - which is the same if I bought the stock itself.
