My query is that If I have Income from the stock market both in the Capital Gains (Short term & Long Term) and Business (Speculative Income / Intraday) heads can I claim STT paid for trading securities taxable under Capital Gains head as a business expense incurred in Intraday (Business Income) head.
And what is the eligibility to claim a deduction of Securities Transaction Tax (STT) as a business expense?
As per Finance bill, 2008; there was change in the treatment of securities transaction tax (STT) for investors whose income from share trading had been taxed under the head of “business income”. After the amendment, the entire STT payment been treated as expenditure against the income from trading of shares.
However, for investors who claim their profit as capital gains, there is no such provision. The STT paid isn’t treated as an expenditure and there is no tax rebate.
The STT paid for transactions claimed under head CG, cannot be claimed business expense, as it is not incurred to derive business income.
Ok, Thank you very much.
But if an individual claims income from share trading activities under both heads capital gains and business income/ speculative income (Intraday) then can he claim STT paid on Intraday transactions as business expense.
Yes, but only the STT paid over intraday transactions, can be be claimed as business expense.
Gupta Sachdeva & Co. Chartered Accountants
New Delhi
CA Final
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