July 31 ITR filing 2024 deadline: Quick guide for investors on filing their income tax returns

The deadline for filing income tax returns (ITR) 2024 is July 31. As a result, numerous taxpayers have begun the filing process, with many having already submitted their returns. However, some are waiting for the last moment to complete this financial task. Personal Finance experts suggest filing the returns as soon as possible to avoid last-minute hurdles.

Understanding the income tax implications of stock market investments is crucial for traders and investors. Here's a quick guide for traders and investors.

Income Categories

Stock market activities can be categorised into capital gains, business income (speculative and non-speculative), and income from other sources like dividends.

Which ITR form to file?

Salaried individuals with income from investments use ITR-1.

ITR-2 includes capital gains.

ITR-3 is for trading profits and business income.

NRIs use ITR-2, and ITR-3 if there is business income.

Speculative and non-speculative incomes

Speculative and non-speculative incomes are separately reported in ITR-3.

Business expenses can be deducted from income in ITR-3.

Losses from trading and investing must be reported.

Annual Information Statement (AIS) reflects stock market transactions.

Capital gains tax

Long-term gains were taxed at 10% (exceeding ₹1 lakh)over 12 months.

Short-term gains taxed at 15% for holdings up to 12 months.

Set-off and carry forward

Losses can be set off within the same head or carried forward.

Specific time limits and rules apply depending on the type of income.

Maintaining records

A profit and loss statement and Balance Sheet are necessary for audit if annual trading profit exceeds ₹2.5 lakh or turnover exceeds ₹25 lakh.

Foreign assets disclosure

If applicable, report foreign assets and income in Schedule FA, even for vested ESOPs in foreign companies.

Understanding these aspects ensures compliance with tax regulations and effective management of investments in the stock market.

Note: This story is for informational purposes only.