IndiaFreeFY 2025-26
F&O Tax Cheat Sheet 2026
Everything that matters on one page: the ICAI turnover formula, audit thresholds, advance-tax dates, deductible expenses, and carry-forward windows. Print and share with your CA.
ICAI Turnover Formula
Turnover = Sum of |realised P/L| per trade
Futures: |entry price - exit price| x lots x lot size
Options: |premium received or paid on square-off or expiry|
Contract value is NOT turnover. Option premium add-back was removed by ICAI in Aug 2022.
Audit Thresholds
44AB(a): mandatory auditTurnover > โน10 cr
44AB(a): all-digital exceptionโน2 cr to โน10 cr, 0% cash
44AD: presumptive schemeTurnover โค โน2 cr, profit โฅ 6%
44AD: profit below 6%Exits scheme, 44AB applies
44AB(e) loss-year trap: Net F&O loss + total income above basic exemption (โน3L new regime) + prior 44AD opt-out in last 5 AYs = mandatory audit regardless of turnover. Being all-digital does not protect against this.
Advance Tax Due Dates (FY 2025-26)
15 June 202515% of estimated liability
15 September 202545% cumulative
15 December 202575% cumulative
15 March 2026100% cumulative
Interest under Section 234B (1% per month) applies on unpaid tax if advance tax paid is less than 90% of total liability. Section 234C applies per installment.
Deductible Trading Expenses
BrokerageYes (within limit)
STT (Securities Transaction Tax)Yes
Exchange transaction chargesYes
SEBI turnover feesYes
GST on brokerageYes
Stamp dutyYes
DP chargesYes (delivery only)
Internet, software subscriptionsProportionate
Home office (if dedicated)Proportionate
STT is deductible as a business expense but not eligible for rebate under Section 88E. All charges must relate to the trading business.
Loss Carry-Forward Windows
F&O business loss8 years
STCG loss (equity)8 years
LTCG loss (equity)8 years
Intraday (speculative) loss4 years, speculative profit only
Carry-forward requires filing ITR before the due date. Late filers lose carry-forward rights for that year. Intraday equity is speculative; F&O is non-speculative business income.
Which ITR Form
F&O income (non-speculative)ITR-3
Intraday equity (speculative)ITR-3
Delivery equity only, no F&OITR-2
44AD presumptive (turnover โค 2 cr)ITR-4 or ITR-3
F&O income is always non-speculative business income. ITR-2 is not appropriate if you have any F&O or intraday equity trades. Use ITR-3.
Key Tax Rates (FY 2025-26)
F&O profit (non-speculative business)At slab rates
Intraday equity (speculative business)At slab rates
STCG on listed equity (111A)20%
LTCG on listed equity (112A), first โน1.25LExempt
LTCG on listed equity above โน1.25L12.5%
Dividend incomeAt slab rates
New regime rates apply unless you have opted for old regime. F&O business income prevents using ITR-1; use ITR-3.
Filing Deadlines (AY 2026-27)
Original ITR-3 (without audit)31 July 2026
Original ITR-3 (with audit)31 October 2026
Belated return31 December 2026
Revised return31 December 2026
Updated return (ITR-U)24 months from end of AY
Missing the 31 July deadline costs loss carry-forward. A belated return can be filed until 31 Dec with a late fee of up to โน5,000 under Section 234F.
Disclaimer: This cheat sheet is for reference only, not tax advice. Rules may change; verify with a qualified Chartered Accountant before filing. Thresholds and rates reflect our reading as of June 2026 for FY 2025-26 (AY 2026-27). Use the audit eligibility checker and turnover calculator for your specific numbers.