Is tax audit required if you incur a loss in F&O trading?

Clipped from: https://www.moneycontrol.com/news/business/personal-finance/is-tax-audit-required-if-you-incur-a-loss-in-f-o-trading-13565036.html

Tax audit depends on the turnover from F&O trading. Turnover is a critical factor because tax audit is triggered only when turnover crosses prescribed limits

Is tax audit mandatory in case of loss from F&O?

Trading in derivatives such as Futures and Options (F&O) is quite common among stock market investors but it’s important to understand their distinct tax treatment compared to equity investments.

The gains or losses from F&O trading are taxed as profits and gains from business or profession.

Derivatives are financial products whose value is derived from an underlying asset and move in tandem with it.

The Income-tax Act classifies business income as either speculative or non-speculative. Section 43(5) excludes derivative transactions from being treated as speculative, as a result, income or loss from F&O is treated as non-speculative business income even if delivery does not take place. This means that any loss from F&O can be set off against other normal business income. F&O income is taxed at the regular slab rates applicable to the taxpayer.