Tax implication on Intraday Trading
Intraday trading profits are taxable in India.
Even though Navia offers Zero Brokerage for intraday trades in Equity and Derivatives, the income tax on your profits is mandatory.
How Intraday Income Is Classified
For tax purposes, trading income is treated as business income and is divided into:
Type of Trading Income | What It Means |
Speculative Business Income | Profits from equity intraday trades (buying and selling the same stock on the same day). |
Non-Speculative Business Income | Profits from F&O (Equity, Currency, Commodity) |
Simple Tax Example
Let’s say Anita, age 30, has the following annual income:
Source | Amount |
Salary | ₹8,00,000 |
Intraday Equity Profit (speculative) | ₹1,50,000 |
F&O Profit (non-speculative) | ₹50,000 |
Bank Interest | ₹50,000 |
- Speculative & Non-Speculative Income : Intraday profit (₹1,50,000) + F&O profit (₹50,000) = ₹2,00,000
- Total Taxable Income:
- Salary ₹8,00,000 + Trading Income ₹2,00,000 + Bank Interest ₹50,000
- Total = ₹10,50,000
- Tax Payable
- The entire ₹10,50,000 is taxed as per the regular income-tax slab you choose (old or new regime).
- For example, under the old regime Anita falls in the 30% slab, so tax is calculated accordingly after deductions.
Note: If you also have short-term capital gains (STCG) from delivery-based stock sales, those gains are taxed separately at 15%.
Key Points to Remember
- Maintain proper books of accounts for all trading activity.
- Pay advance tax if your total tax liability for the year exceeds ₹10,000.
- Intraday losses can be set off only against other speculative gains (and carried forward for 4 years).
Tips for Successful Intraday Trading
- Trade only with capital you can afford to risk.
- Avoid over-trading to recover losses.
- Track every trade—profits and losses—for accurate tax filing.
- Stay updated on market news and company announcements.
Navia Advantage
While taxes are unavoidable, you can save on brokerage:
- Zero Brokerage on all Intraday Equity and Derivatives trades with Navia.
- Lower costs help you retain more of your profit after tax.
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