Hello Everyone,
This is something that every new trader would want to know, and many would want to get clarified. Many trade brokers always say that they'll offer intraday trading at a brokerage of 0.05% or 0.03%.. sometimes while buying and selling or only while selling. There are many other taxes that are charged which the brokers dont advertise or try to conceal it as much as possible, its simply because its much higher than the brokerage that they charge, and it will give a view that trading with them would be a costly affair to their clients.
Now coming to the taxes other than brokerage,
1. 12.36% on total brokerage
2. STT(Securities Transaction Tax) at 0.025% only on the selling value
3. Transaction Charges - 0.0035% on buy + 12.36%
0.0035% on sell + 12.36%
4. Stamp Duty - 0.002% on buy + 12.36%
0.002% on sell + 12.36%
For example, lets consider a trade where shares worth 1,00,000 are bought and sold at 10% profit at 1,10,000. (Its rarely possible, only for understanding purposes)
And Lets consider the Brokerage Charges to be 0.02% on both sides.
While Buying
1. Brokerage
0.02% + 12.36% of Brokerage = 0.022472%
0.022472% of 1,00,000 = 22.472
2. STT is spared while buying
3. Transaction charges
0.0035%+12.36% of TC = 0.0039236%
0.0039236% of 1,00,000 = 3.9236
4. Stamp Duty
0.002% + 12.36% of SD = 0.0022472%
0.0022472% of 1,00,000 = 2.2472
Total charges while buying = 22.472+3.9236+2.2472 = 28.6428
While Selling
1. Brokerage
0.02% + 12.36% of Brokerage = 0.022472%
0.022472% of 1,10,000 = 24.7192
2. STT - Securities transaction tax
0.025% on the sale value
Note - Service tax of 12.36% is not charged on STT
0.025% of 1,10,000 = 27.5
3. Transaction charges
0.0035%+12.36% of TC = 0.0039236%
0.0039236% of 1,10,000 = 4.31596
4. Stamp Duty
0.002% + 12.36% of SD = 0.0022472%
0.0022472% of 1,10,000 = 2.47192
Total Charges on Selling = 24.7192+27.5+4.31596+2.47192=59.007
Hope its clear till here to everyone.
Further to simply calculations and form a basic equation, I'll just combine certain charges.
Total Charges while Buying -
(brokerage+12.36%of brokerage) + (0.0061798% of Buy Value)
Total Charges while Selling -
(brokerage+12.36%of brokerage) + (0.0311798% of Sell Value)
Note - If your broker is charging brokerage only on selling. Then just exclude the brokerage part while buying and its only 0.0061798% of Buy Value.
I hope I've presented everything clearly, point me out if i'm wrong.
Thank you,
RMSRINI
This is something that every new trader would want to know, and many would want to get clarified. Many trade brokers always say that they'll offer intraday trading at a brokerage of 0.05% or 0.03%.. sometimes while buying and selling or only while selling. There are many other taxes that are charged which the brokers dont advertise or try to conceal it as much as possible, its simply because its much higher than the brokerage that they charge, and it will give a view that trading with them would be a costly affair to their clients.
Now coming to the taxes other than brokerage,
1. 12.36% on total brokerage
2. STT(Securities Transaction Tax) at 0.025% only on the selling value
3. Transaction Charges - 0.0035% on buy + 12.36%
0.0035% on sell + 12.36%
4. Stamp Duty - 0.002% on buy + 12.36%
0.002% on sell + 12.36%
For example, lets consider a trade where shares worth 1,00,000 are bought and sold at 10% profit at 1,10,000. (Its rarely possible, only for understanding purposes)
And Lets consider the Brokerage Charges to be 0.02% on both sides.
While Buying
1. Brokerage
0.02% + 12.36% of Brokerage = 0.022472%
0.022472% of 1,00,000 = 22.472
2. STT is spared while buying
3. Transaction charges
0.0035%+12.36% of TC = 0.0039236%
0.0039236% of 1,00,000 = 3.9236
4. Stamp Duty
0.002% + 12.36% of SD = 0.0022472%
0.0022472% of 1,00,000 = 2.2472
Total charges while buying = 22.472+3.9236+2.2472 = 28.6428
While Selling
1. Brokerage
0.02% + 12.36% of Brokerage = 0.022472%
0.022472% of 1,10,000 = 24.7192
2. STT - Securities transaction tax
0.025% on the sale value
Note - Service tax of 12.36% is not charged on STT
0.025% of 1,10,000 = 27.5
3. Transaction charges
0.0035%+12.36% of TC = 0.0039236%
0.0039236% of 1,10,000 = 4.31596
4. Stamp Duty
0.002% + 12.36% of SD = 0.0022472%
0.0022472% of 1,10,000 = 2.47192
Total Charges on Selling = 24.7192+27.5+4.31596+2.47192=59.007
Hope its clear till here to everyone.
Further to simply calculations and form a basic equation, I'll just combine certain charges.
Total Charges while Buying -
(brokerage+12.36%of brokerage) + (0.0061798% of Buy Value)
Total Charges while Selling -
(brokerage+12.36%of brokerage) + (0.0311798% of Sell Value)
Note - If your broker is charging brokerage only on selling. Then just exclude the brokerage part while buying and its only 0.0061798% of Buy Value.
I hope I've presented everything clearly, point me out if i'm wrong.
Thank you,
RMSRINI
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