Oh, I always thought you were trading in Personal Account.
I have two queries as I want to open a corporate account too.
- What is the Incorporation cost ?
- What are the Annual compliances costs ?
Thanks
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I have personal accounts too. But it’s too difficult to handle for me. Login to so many accounts. So slowly I have been moving funds to the firm. 25percent are now moved in 3 months. Long way to go. May take another 9 months to move around 70 percent. Remaining I may not move for many other reasons.
Partnership deed stamp paper 2k
Pan 107
Account opening 500 in zerodha. Some brokers don’t charge.
For me it’s zero.
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there is an Exemption Income section in ITR where Share of Profit and Firm details has to be entered. (Partner ITR)
This Share of Profit is only distrubuted Profit or Firm’s total profit (partner’s stake) ?
(i.e. firm made 10 lac PAT, there are two partners with 50:50 ratio. now they only distrubuted 1 lac profit. now partner has to show 50K or 5 lac in ITR.)
Is the maximum surcharge 12% in partnership firm?
It is 25% this FY for individual. So total tax is 39% with 25% surcharge and 4% cess.
But its only 34.27% in Partnership firm (30% tax, 12% surcharge and 2% cess). So that’s 4.72% saving or not?
Yes it is. Why do you think I got a firm account done?
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Correct. Though the term used by you as taxable income is inappropriate but I think what you are trying to say is right.
How would I know what people are doing?
I do Fno. And many others also.
Am not associated with Quicko in any way. You can consult me privately if you want to.
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Hi Jason ,
Read your replies and I too had few queries on similar lines for opening a partnership firm and I would like to connect with you . Can you please let me know how can i connect with you .
Yeah sure. You can send me a private message.
Hello Jason,
I had a very similar query as being discussed in the thread and would like to connect with you.
You had suggested to connect via private message.
Apologies, I did not find an option to connect privately here. may be you can guide me a bit.
thanks again
Dear all,
In the entire thread, the discussion is on Partnership firm. Can the same not be done for LLP?
i.e. can we not open an LLP for the purpose of trading?
Are the pre-requisites too much (compared to a partnership)?
Hey @SanjibG,
Yes, one can incorporate an LLP for trading purposes. However, incorporating an LLP for trading comes with certain compliances that you will have to adhere to:
- LLP with objective investment activities and trading in derivatives will not be granted an incorporation certificate easily.
- You will have to obtain an NBFC license if 50% of your total assets comprise of financial assets and obtaining a NBFC license comes with its own regulations and compliances.
- LLPs need to submit the annual financial statements and audit reports every year.
Now, from the taxation point of view, the taxation for an LLP is similar to a partnership firm. The profit will be taxed at a flat 30%. If the income crosses ₹1 crore then the surcharge will be levied at 12%.
Alternatively, you can also do trading as a sole proprietorship. In such a case, the tax is levied on slab rates and the surcharge rate is 10% if income crosses 50 lakhs and 15% if income crosses 1 crore. You can read more on surcharge rates for individuals here!
Based on above provisions, you can select the best suitable alternative.
Sir, if we do e-margin trading and not f and o ,how is e-margin trade profits treated for tax purpose, capital gain or business amount.e margin we pay 30% and 70% bank/broker pays and will charge 15-18% per annum rate of interest till we sell off.
The source of funds for your purchases is irrelevant for tax purposes.
You have the flexibility to classify the income as either capital gains or business income, as long as you maintain consistent treatment over the years.
Hey @SR_BP,
As rightly mentioned by @Jason_Castelino,
The taxation only depends on whether you do delivery-based trading, intraday or F&O. Based on that, the applicable tax rates would be applicable.
Delivery-based trading income is generally classified as capital gains which are taxed at 10% in case of long-term and 15% in case of short term. Moreover, income from intraday or F&O trading is classified as business income which is taxed as per slab rate.
Hope this helps!