INCOME TAX22 Sept 2026
Income Tax Act 2025: Tax expert explains F&O rules and how to correctly set off and carry forward losses | Mint
The new Income-tax Act, 2025 replaced the 1961 Act from 1 April 2026, with fresh section numbers. Futures and options (F&O) trades still count as non-speculative business income, not capital gains. Business losses can be carried forward for eight years, but speculation losses only four, and only against speculation profits. File your loss return on time to keep that benefit.
Key Statutory Highlights
- The Income-tax Act, 2025 came into force on 1 April 2026, replacing the Income Tax Act, 1961.
- Eligible exchange-traded F&O transactions are treated as non-speculative business transactions, taxed under Profits and Gains of Business or Profession.
- Under Section 112, a non-speculative business loss can be carried forward for up to eight years, while Section 113 limits speculation losses to four tax years.
Actionable Advice for Taxpayers / Founders:Confirm with your CA whether your F&O trades qualify as specified derivative transactions, keep a record of trading expenses like brokerage and internet charges, and file your loss return within the due date so the carry-forward benefit is protected.
Statutory Disclaimer: TaxQue Shorts are AI-assisted editorial briefs for compliance awareness. This brief has not passed every source check; confirm the original notification before acting. This does not constitute formal legal or CA counsel.
TaxQue News Desk
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