Whenever we see our contract note, we find that several charges and
taxes were deducted on each transaction that we performed. Many of us
wonder, what are these charges and at what rate we are charged on
different types of trades that we perform.
Let’s take up every single charge that is deducted from our account, and
understand how to calculate them, so we know, the exact profit that we
will earn from each trade we perform.
1. BROKERAGE
Brokerage is a fee that your broker charges you, for providing you
its services, a platform and infrastructure to trade in the stock
market. Different brokers charge different brokerage. At Moneypalm,in
our endeavour to provide you more value for your money.
2. STT OR SECURITIES TRANSACTION TAX
This is a Tax charged by the Government, for the transactions that
you do in the Stock Market. Different types of transactions invite a
rate of STT. We will discuss all of them below:
a. Stock Delivery : 0.1% on buying and 0.1% on selling
b. Stock Intraday: No STT on Buying. 0.025% only on selling
c. Stock/Index Futures: No STT on Buying. 0.01% only on selling
d. Stock/Index Options: No STT on Buying. 0.017% only on selling (Only on Premium)
e. Stock/Index Options: 0.125% on exercised Trade (If we do not sell
Option, but Option is exercised by is exchanged if it is “In the
Money”& STT is calculated on closing price of the underlying Stock).
We will understand more about Options in our upcoming posts. So stay
tuned onTradeTalk. Lots of interesting stuff lined up for you.
f. Currency Futures: No STT on Buying. No STT on Selling
g. Commodities Futures: No CTT (Commodities Transaction Tax) on Buying. 0.01% only on selling
3. SEBI TURNOVER CHARGES
SEBI charges 0.0001% on all buy and sell transactions in Stock
Delivery, Stock Intraday, Stock Futures, Stock Options and Currency
Futures.
There are no SEBI charges on Commodities.
4. SERVICE TAX (INCLUDING EDUCATION CESS, SECONDARY AND HEIGHER EDUCATION CESS)
It is charged at 12.36% on the brokerage, on Transaction Charges
charged by the exchange and on clearing charges in F&O Segment.
It is applicable on buying and selling of all securities where brokerage is charged.
5. TRANSACTION CHARGES
Transaction Charges or Turnover Charges varies by different types of transactions:
Stock Delivery and Intraday on all buy and sell orders: 0.0035%
Stock Futures (on all buy and sell orders): 0.0027%(includes clearing charges of 0.0007%)
Stock Options {on all buy and sell orders (on premium)}: 0.08% (includes clearing charges of 0.03%)
Commodities (on buy and sell orders): 0.0025%
Currency futures (on buy and sell orders): 0.00165% (includes clearing charges of 0.0005%)
Currency Option (on buy and sell orders): 0.05250% (includes clearing charges of 0.0125%)
*Kindly note all of the above will attract an added Service Tax calculated at 12.36%
6. STAMP DUTY
In India Stamp Duty is levied by various states and hence rate of
stamp duty varies from state to state. A trader residing in Maharashtra
may have to pay different stamp duty than a trader residing in Haryana
You can also use our Brokerage Calculator to know the exact charges you will pay for any trade you do.
Kindly note, the above charges are subject to change from time to
time as per the Government Policy. What will definitely not change is
our Brokerage Commitment of Rs. 20 per trade or 0.1% of total transacted
volume per trade (whichever is lower), and the quality and warmth of
our services.
At Moneypalm, it is our constant endeavour to keep our customers
updated with the information that concerns them the most, so they have a
happy and profitable time investing in the stock market as we firmly
believe in our philosophy – “Together We Grow”