New Delhi, May 26 -- Profits from intraday trading and Futures & Options (F&O) trading are taxed differently from regular stock investments in India. While intraday trading is deemed speculative business income under section 43(5) of the Income Tax Act, F&O income is classified as non-speculative business income.

This distinction affects tax rates, loss set-off rules, and even the ITR form a trader must file. Here's a detailed look at how intraday and F&O trading profits are taxed in India under the applicable rules.

Purchasing and selling securities listed in a stock exchange one the same day is known as intraday trading. The trader's primary purpose of transacting in this method is to take advantage of the short-term price movements a...