What is Securities Transaction Tax (STT) and how is it calculated?

If the portion of paise in STT is equal to or more than 50, it will be rounded off to the nearest rupee, and if it is less than 50, it will be rounded down to the nearest rupee. For instance, if the STT is ₹100.60 it will be rounded off to ₹101, and if the STT is ₹100.40 it will be rounded down to ₹100.

Securities Transaction Tax (STT) is a tax on buying and selling stocks and other securities on Indian stock exchanges. As per the NSE circular (PDF) the STT charges are revised from 1st October 2024.

STT for various types of orders are:

Order type	New charges	Old charges
Equity intraday	0.025% (₹25 per lakh) on the sell side.	0.025% (₹25 per lakh) on the sell side.
Equity delivery	0.1% (₹100 per lakh) on both the buy and sell side.	0.1% (₹100 per lakh) on both the buy and sell side.
Options	0.125% of the intrinsic value on options that are bought and exercised. 0.1% of the premium for options that are shorted.	0.125% of the intrinsic value on options that are bought and exercised. 0.0625% of the premium for options that are shorted.
Futures	0.02% (₹20 per lakh) on the sell side.	0.0125% (₹12.5 per lakh) on the sell side.

Since the STT is charged on both the buy and sell side for delivery trades, the average price is to be calculated. The formula to calculate the average price is:

Average price = (Buy Qty*Buy Price) + (Sell Qty*Sell Price) / (Buy Qty+Sell Qty)
Average price = (Total cost to buy shares) + (Total revenue from selling shares) / (Total number of shares bought and sold)

Example scenarios

Equity intraday

Buy: 500 shares at ₹100 each.
Sell: 500 shares at ₹105 each.
Average price = (500 * ₹100) + (500 * ₹105) / 1000 = ₹102.5
STT (on sell side) = 500 (shares sold) * 102.5 (average price) * 0.025% = ₹13 (₹12.81 rounded off to the nearest rupee)

Equity delivery

1st October 2024 Buy: 500 shares at ₹100 each.
3rd October 2024 Sell: 500 shares at ₹105 each.
STT Buy = 500 (shares bought) * 100 * 0.1% = ₹50
STT Sell: 500 (shares sold) * 105 * 0.1% = ₹53( ₹52.50 rounded off to the nearest rupee)

Options

STT on the intrinsic value of an exercised option contract
- 1 lot of CE = 50 units
- Strike price = ₹17,300
- Spot price = ₹17,350
- Intrinsic Value for 1 lot = (₹17,350 - ₹17,300) * 50 units = ₹2,500
- STT on intrinsic value = 0.125% * ₹2,500 = ₹3 (₹3.125 rounded off to the nearest rupee)

STT on premium
- 1 lot = 50 units
- Strike price = ₹17,300
- Premium received = ₹60 for one lot
- Total Premium received = ₹60 * 50 units = ₹3,000
- STT on premium = 0.1% * ₹3,000 = ₹3

Futures

Sell: 1 Lot of XYZ futures contracts.
Price of 1 lot = ₹7,50,000
STT (on sell side) = 0.02% * ₹7,50,000 = ₹150

The Zerodha charges page lists all the charges involved in trading and investing. You can also use the brokerage calculator to calculate charges for any trade.

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