Should you opt for presumptive taxation on F&O income
- Some traders use ITR-4 which allows the benefit of presumptive taxation, others use ITR-3.
Trading in futures and options (F&O) is now a source of income for people from all walks of life—self-employed, salaried, homemakers and even pensioners. And its growing popularity reflects in the number of active derivatives traders in the markets—the number surged 8-fold, from less than 0.5 million in 2019 to 4 million as of August, as per data from the National Stock Exchange. But, as with every other source of income, this one also comes with a tax liability.