Implication of STT paid

334 views 3 replies

What are the implication of STT paid on share?

Replies (3)
When STT levy was introduced in 2004, simultaneously new Section 10(38) was introduced to benefit taxpayers who would incur STT. As per Income-tax Law, for transactions undertaken until 31 March 2018, any capital gain on sale of shares or equity oriented mutual fund units (EOMF) which are subject to STT is taxed at beneficial/Nil rate.

While long term capital gain (if shares or EOMF are held for > 12 months) are exempt from tax, short term capital gain on such securities are taxed at concessional rate of 15%. However, in order to prevent abuse of exemption provisions by certain persons for declaring their unaccounted income as exempt long-term capital gains by entering into sham transactions, Finance budget 2018 proposed to withdraw the exemption on long term capital gain and tax long term capital gains on equity shares and EOMF at concessional rate of 10% with respect to transfer effected on or after 1 April 2018.

However, gains accrued till 31 January 2018 are grandfathered i.e., in case of transfers upto 31 January 2018, cost of acquisition of shares or EOMF acquired before 1 February 2018 will be replaced by fair market value as on 31st January 2018.

Tax on business income

In case of person who is trading in securities and offering income/loss from such trading as business income, STT paid is allowed to be deducted as business expense.
LTCG 112A
excess of 10% OR STCG 111A

following conditions
STT Paid on acq and TRF of equity share
STT Paid on transfer of eou and units of business TRUST
Sir,
I am a Long Term investor earning income from Long Term Capital Gain for purchase & sale of Equity Shares more than 12th Months holding, paid STT on the both side purchase & sale can I add STT as cost of acquisition on purchase & deduct STT as expenditure on sales side.
need help.

Leave a Reply

Your are not logged in . Please login to post replies

Click here to Login / Register  

Company
06 July 2026
Accountant

Agarwal Anoop and Associates

Noida

CA Final

View Details
Company
05 July 2026
Financial Controller

NovumLake Partners

Mumbai

CA

View Details
Company
12 June 2026
Accounts & Taxation Executive

Winshine Financial Services

Mumbai

CA Inter

View Details
Company
19 June 2026
Accounts Executive

Getfive Advisors Pvt. Ltd.

Ahmedabad

CA Inter

View Details
Company
25 June 2026
Accounts & Taxation Executive

Dindukurthy & Associates

Hyderabad

MBA

View Details
Company
Featured 24 June 2026
HEAD - AUDIT AND TAXATION

A R JADHAV AND ASSOCIATES

Mumbai

CA Inter

View Details
Company
20 June 2026
Assistant Accounts Manager

Fintax Professionals

Gurgaon

CA Inter

View Details
Company
06 July 2026
C.A./CA Inter OR pursuing C.A./GST/Accounts/Audit/IT - Head

Arvindkumar Maniar & Co.

Rajkot

CA

View Details