F&O Tax Calculator
Work out the income tax on your futures & options trading, how a loss sets off and carries forward, and whether your turnover needs a tax audit.
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Enter your figures — the result on the right updates as you type.
F&O tax computation
File ITR-3 for your F&O income with a CA
P&L and balance sheet from your broker statements, loss carry-forward and the tax audit if it applies.
Disclaimer: Indicative estimate for a resident individual for FY 2025–26, including surcharge (without marginal relief on surcharge) and 4% cess. The audit check is a guide only — whether section 44AB applies depends on your cash transactions and past presumptive-tax elections, so confirm it with a CA.
How F&O income is taxed
Profit from trading equity, currency or commodity futures and options on a recognised exchange is non-speculative business income under section 43(5). It is added to your other income and taxed at your slab rate — not at the capital-gains rates that apply to delivery-based share trades. You report it in ITR-3 with a profit & loss account and a balance sheet.
Loss, turnover and audit explained
Setting off a loss
An F&O loss can be set off against any income in the same year except salary — so it reduces interest, rent or other business income, but not your pay. Whatever is left carries forward for 8 years against future business income, provided the return is filed by the due date.
What "turnover" means
Per the ICAI guidance note, F&O turnover is the sum of the absolute profit and loss on each trade — a ₹5,000 profit and a ₹3,000 loss make ₹8,000 of turnover. It is not the contract value, and option premium is no longer added.
When a tax audit applies
Under section 44AB an audit is needed if turnover exceeds ₹10 crore (when cash transactions are within 5%). Below that, an audit can still apply if you declare profit under 6% of turnover, your income exceeds the basic exemption limit, and you are bound by an earlier presumptive-tax election under section 44AD.
Advance tax
F&O profit is not taxed at source, so if your total tax for the year is ₹10,000 or more you must pay advance tax in instalments — or pay interest under sections 234B and 234C.
Questions people ask
Short answers on F&O Tax Calculator. Tap a question to open it.
01How is F&O income taxed in India?
Profit from futures and options traded on a recognised stock exchange is non-speculative business income under section 43(5). It is added to your other income and taxed at your slab rate, and it is reported in ITR-3 with a profit and loss account and balance sheet.
02Can I set off an F&O loss against my salary?
No. A non-speculative business loss can be set off against income under any head except salary in the same year. The unabsorbed loss can be carried forward for 8 years against business income, but only if the return is filed by the due date.
03How is F&O turnover calculated?
Per the ICAI guidance note on tax audit, turnover is the sum of the absolute profit and loss on each trade. A ₹5,000 profit on one trade and a ₹3,000 loss on another make ₹8,000 of turnover. It is not the contract value, and option premium is no longer added.
04When is a tax audit required for F&O traders?
A tax audit under section 44AB is required if turnover exceeds ₹10 crore where cash transactions do not exceed 5%. Below that, an audit can still apply if profit is below 6% of turnover, income exceeds the basic exemption limit, and you are bound by an earlier presumptive-tax election under section 44AD.
05Do I need to pay advance tax on F&O profit?
Yes, if your total tax liability for the year, after TDS, is ₹10,000 or more. F&O profit is not subject to TDS, so traders usually have to pay advance tax in instalments to avoid interest under sections 234B and 234C.
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Disclaimer: This tool gives indicative results for general guidance only and is not professional advice. Please verify with a qualified CA before acting on the numbers.