A senior citizen accidentally made an intraday trade with a Rs 5 loss. Can it be treated as business income and make him liable to pay advance tax?

Intraday trading

A senior citizen, by mistake, carried out an intraday trade resulting in a loss of Rs 5. Today's Ask Wallet Wise query answers whether this makes him liable to pay advance tax.

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After buying 50 shares of a company on 27.03.2025, I tried to purchase another 50 shares on the same day after noticing that the price had fallen by Rs. 5. However, by mistake, instead of placing a buy order, I accidentally placed a sell order for one share (the default quantity), which got executed. I had no intention of doing any intraday transaction. I have not carried out any other intraday transactions during this year. This was purely an unintentional error, and I incurred only a small loss of Rs 5.

My concern is whether this isolated intraday transaction would be treated as a business activity, as that would make the provisions for advance tax applicable. Being a senior citizen, I am otherwise not required to pay advance tax unless I have business income. Can I ignore this Rs 5 loss, file ITR-2, and avoid the advance tax provisions?

For FY 2024–25, I paid my entire tax liability in March 2025. The AIS does not show this intraday transaction so far. While filling in ITR-3 today, I was surprised to see that the system is calculating Rs. 1,156 as interest for failure to pay advance tax. I have not yet submitted the ITR and seek your guidance.

Expert Advice: As per the income tax law, taxpayers are required to pay advance tax in four instalments, and failure attracts interest under Sections 234B and 234C. However, senior citizens without business income are exempt from advance tax and can discharge their tax liability at the time of filing ITR.

Although intraday share transactions are normally treated as business income, in your case, this single, accidental trade with a negligible Rs. 5 loss does not make you liable for advance tax. You can safely ignore it and file ITR-2 without worrying about penal interest. Moreover, intraday transactions are not separately reported by brokers, so you need not be concerned on that count.

Disclaimer: The views expressed by experts on Moneycontrol are their own and not those of the website or its management. Moneycontrol advises users to check with certified experts before taking any investment decisions.

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