What is STT?
STT is a tax levied by the Government of India on every transaction in the stock market. It was introduced in 2004 via the Securities Transaction Tax Act and has been one of the primary revenue sources from capital markets ever since.
Every broker in India is legally required to collect STT and remit it to the government. No broker can waive it, reduce it, or offer you a deal on it. It is non-negotiable.
Current STT rates
| Trade type | Rate | Applied on | Which side |
|---|---|---|---|
| Equity Delivery | 0.1% | Trade value | Both buy AND sell |
| Equity Intraday | 0.025% | Sell value only | Sell only |
| Equity Futures | 0.02% | Sell value | Sell only |
| Equity Options (sell) | 0.1% | Premium value | Sell only |
| Equity Options (exercise) | 0.125% | Intrinsic value | On exercise |
Real examples
₹10,000 delivery (buy + sell)
STT ₹20.00
0.1% × ₹10,000 × 2 = ₹20.00
₹50,000 delivery (buy + sell)
STT ₹100.00
0.1% × ₹50,000 × 2 = ₹100.00
₹1,00,000 delivery (buy + sell)
STT ₹200.00
0.1% × ₹1,00,000 × 2 = ₹200.00
₹50,000 intraday (sell only)
STT ₹12.50
0.025% × ₹50,000 = ₹12.50
Key things to know
- Delivery trades pay STT twice — once on buy, once on sell. This is the biggest STT hit.
- Intraday pays STT only on the sell side. This is one reason intraday brokerage is lower.
- STT applies to the trade value, not profit. Even if you sell at a loss, you pay STT.
- STT cannot be claimed as a business expense for most investors (salaried). Active traders may have different treatment — consult a CA.