F&O is not simple capital gains
Futures & options income is typically business income (non-speculative or speculative per rules) — reported in [Schedule BP](/glossary/business-profession-schedule), not Schedule CG.
Most active F&O traders file ITR-3.
Turnover calculation
Turnover for F&O is not contract value alone — ITD guidance uses sum of absolute profits and losses in many audit contexts. Broker tax P&L helps but consult current audit thresholds.
Tax audit u/s 44AB
High turnover or losses may trigger audit requirement — verify AY 2026-27 limits with a qualified professional if you traded heavily.
ITR-4 usually not for F&O
Presumptive 44AD is for eligible businesses — F&O traders generally cannot use ITR-4 Sugam for derivative income.
Salary + F&O
Dual income → combine salary from Form 16 with F&O P&L → often ITR-3 with both salary and BP schedules.
AIS broker lines
Reconcile broker AIS with Zerodha/other P&L — see Zerodha tax P&L.
Advance tax
Active traders often owe [advance tax](/glossary/advance-self-assessment-tax) quarterly — missing instalments adds interest at filing.
F&O companion steps are on our roadmap — today use broker reports and qualified advice for audit cases.