Commodity Futures Tax in India (2026): MCX Gold, Silver and Crude Oil
Note: This is general information, not tax advice, and tax rules change. Verify the current figures against the Income Tax Act, the relevant Finance Act and ICAI guidance, and confirm your own position with a qualified Chartered Accountant.
How commodity futures are classified
Section 43(5) of the Income Tax Act defines speculative transactions as those settled without actual delivery. It then carves out specific categories as non-speculative: among them, transactions in commodity derivatives carried out on a recognised stock exchange where CTT is paid.
MCX (Multi Commodity Exchange) is a recognised exchange. CTT applies to commodity derivative contracts traded there. Gold futures, silver futures, copper, crude oil, natural gas, and other MCX contracts all qualify as non-speculative business income.
The tax outcome: commodity futures income is added to your equity F&O income in Schedule BP of ITR-3, both under the non-speculative business head. A loss in one offsets a profit in the other in the same year.
Turnover computation for MCX
The ICAI absolute-sum method applies to commodity futures exactly as it does to equity F&O. Turnover is the absolute sum of realised profit and loss per contract, not the contract notional value.
If you trade crude oil futures and settle 10 contracts, adding up the absolute value of profit or loss on each settlement gives you the turnover. A โน5,000 profit on one contract and a โน3,000 loss on another produces โน8,000 of turnover, not โน2,000 net and not the full notional.
Your MCX broker provides a realised P&L statement. Use that, not the contract value column, to compute turnover.
CTT: the commodity equivalent of STT
Commodity Transaction Tax is a central government levy, introduced in 2013, on non-agricultural commodity derivatives. CTT is charged on the seller at a rate of 0.01% on the contract value for futures.
CTT appears on your MCX contract note. It is deductible as a business expense against your commodity futures income, reducing taxable profit. This is the same treatment as STT on equity F&O. Include it in your expense tally alongside brokerage, exchange charges, and GST on brokerage.
Combined audit threshold: equity F&O plus MCX
For audit applicability under Section 44AB, the โน10 crore threshold applies to your total non-speculative business turnover. This includes equity F&O turnover plus commodity futures turnover plus currency derivatives turnover, all added together.
Most active traders find their combined turnover well below โน10 crore because turnover is the absolute-sum of P&L, not notional contract value. But if you trade large commodity positions, check your combined figure.
The 44AB(e) loss-year trap also applies to the combined picture: if you report a net loss or under-6% profit across all non-speculative business segments and your other income exceeds the basic exemption, audit may be mandatory. Read the 44AB(e) trap explained.
MCX losses and the 8-year carry-forward
Non-speculative business losses from commodity futures carry forward for 8 assessment years and can be set off against future non-speculative business income. This includes future equity F&O profits. The set-off works across segments because they share the same income head.
As with equity F&O losses, the carry-forward is conditional on filing ITR-3 by the due date. A belated return forfeits the carry-forward.
Multi-broker and multi-segment filing
Traders running equity F&O on Zerodha or Dhan and commodity futures on a separate MCX terminal need to aggregate both. Upload all broker files to Aktai Tax and the report computes combined turnover, combined net P&L after expenses, and the combined audit check. The tax-ready output covers all segments in a single ITR-3-ready report.
Frequently asked questions
Is MCX commodity futures income treated the same as equity F&O for tax?
Yes. Commodity futures on MCX (gold, silver, copper, crude oil, natural gas, etc.) are non-speculative business income, taxed the same way as equity F&O. The ICAI absolute-sum turnover method applies, losses carry forward for 8 years, and the income goes into Schedule BP of ITR-3.
Can I set off an MCX commodity futures loss against an equity F&O profit?
Yes. Both are non-speculative business income, so they sit in the same head. An MCX loss reduces your equity F&O profit within Schedule BP, and vice versa. The combined net figure is what gets taxed or carried forward.
What is CTT and can I deduct it?
CTT stands for Commodity Transaction Tax, levied on commodity derivative transactions on Indian exchanges. It is deductible as a trading expense against your commodity futures business income, just as STT is deductible against equity F&O income.
Does MCX turnover count toward the F&O audit threshold?
Yes. For audit applicability under Section 44AB, turnover is your total non-speculative business turnover across all segments: equity F&O plus commodity futures plus currency derivatives. The โน10 crore threshold applies to the combined figure.