scrip-wise reporting for day trading

No need for scrip-wise reporting of day trading and short term capital gains in ITR: CBDT

The Income Tax Department on Saturday issued a clarification stating that there is no requirement of scrip-wise reporting for day trading and short-term sale or purchase of listed shares in income tax returns for assessment year 2020-21. They tweeted about it

In a welcome relief for taxpayers, CBDT said there will be no requirement of scrip-wise reporting of day trading in ITR, where the gains are from day trading shown as business income or in nature of short term capital gains, where no benefit of grandfathering is being claimed.

Long -term capital gains in equities above ₹1 lakh are now taxed at the rate of 10%. Also, the investments made until 31 January were grandfathered exempting gains earned up to 31 January 2018 for investments made earlier.

The Finance Act, 2018 allowed exemption to the gains made on the listed shares/specified units up to 31.01.2018 by introducing grandfathering mechanism for computation of long-term capital gains for these shares.

The scrip wise details in the IT returns for AY 2020-21 is required to be filled up only for the reporting of the long-term capital gains for the shares/units that are eligible for the benefit of grandfathering.

As the grandfathering is to be allowed by comparing different values (such as cost, sale price and market price as on 31.01.2018) for each shares/units, there is a need to capture the scrip wise details for computing capital gains of these shares/units. “The scrip wise details are not required in income tax return forms for AY 2020-21 for computation of capital gains/business income from shares/units which are not eligible for grandfathering,” the tax authority further said.

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