Compare Articles Reports Glossary Complaints

Brokerage Charges Explained (Brokerage, Taxes, Fees)

Published on Thursday, November 20, 2014 by Chittorgarh.com Team | Modified on Tuesday, April 4, 2023

Zerodha (Flat Rs 20 Per Trade)

Invest brokerage-free Equity Delivery and Direct Mutual Funds (truly no brokerage). Pay flat Rs 20 per trade for Intra-day and F&O. Open Instant Account and start trading today.

Brokers are middlemen or agents who help us in buying and selling shares, derivatives (Futures and Options) and other financial instruments. Brokers charge a fee called brokerage for the service they offer.

But brokerage is not the only fee customers have to pay. The total amount paid to the stock/commodity brokers is made of multiple charges, fees and taxes. This includes:

1. Brokerage

The fee brokers charges for the service they offer. Each broker has its brokerage model. There are 3 types of brokerage plans available in India:

Brokerage in Percentage of Trading Volume
Flat per trade brokerage
Unlimited Trading Plan

Note: While traditional brokers charge the brokerage in % of trade amount; the discount brokers offer a flat monthly or per-trade fee.

2. Transaction Charges (Exchange Turnover Fee)

The transaction charge is a fee charged by an exchange (BSE, NSE, MCX) for using its platform. This is the largest part of the cost of trading with discount stock brokers. The transaction fee is an addition of two charges.

Transaction charge = Exchange Turnover Charges + Clearing Charges

Visit Transaction charges are explained for more detail about transaction charges

3. Securities Transaction Tax STT

The STT is payable on the value of securities transacted through a recognized stock exchange. This is charged only on the sell side for intraday and F&O trades. It is charged on both sides for delivery trades in equity. There are no STT on Bonds, Currency and Mutual funds.

Segment	STT on Share Trading
Equity Delivery	0.1% on both Buy and Sell
Equity Intraday	0.025% on the Sell Side
Equity Future	0.0125% on Sell Side
Equity Options	0.0625% on Sell Side(on Premium)
Currency Futures	No STT
Currency Options	No STT
Commodity Future	0.01% on Sell Side (Non-Agri)
Commodity Options	0.05% on Sell Side

4. Stamp Duty

Stamp Duty on securities transactions is the tax levied on documentation by the state governments in India. It applies to all securities market transactions including buying of Stocks, Mutual Funds, ETF, bonds etc. It is collected by stockbrokers or Clearing Corporations or by the Depositories. Subsequently, the collected stamp duty is disbursed to the respective states.

Trading Segment	Stamp Duty Rate
Equity Delivery	0.015% (Rs 1500 per crore)
Equity Intraday	0.003% (Rs 300 per crore)
Futures (equity and commodity)	0.002% (Rs 200 per crore)
Options (equity and commodity)	0.003% (Rs 300 per crore)
Currency (F&O)	0.0001% (Rs 10 per crore) on buy-side
Mutual Fund	0.005% (Rs 500 per crore)

Note:

The stamp duty is applicable only on buy side and not on sell side.
In case of shares transfer through DIS, the delivery stamp duty i.e 0.015% shall be applicable.
Stamp duty on Mutual Funds is applicable on all fresh purchases including monthly SIPs, Lumpsums, STPs, dividend reinvestment.
Stamp duty on Mutual Funds is applicable if an investor transfers units from one demat account to another.

Click here to find more details about Stamp Duty Rates.

5. GST on Share Trading in India

GST is a tax imposed by the Government of India on services provided in India. GST on securities transactions is charged at 18% of the total cost of brokerage plus transaction charges.

Segment	GST Rates
Equity Delivery, Intraday, F&O	18% on Brokerage + Transaction Charge
Currency F&O	18% on Brokerage + Transaction Charge
Commodity	18% on Brokerage + Transaction Charge

6. SEBI Turnover Fee or SEBI Charges

SEBI (Securities and Exchange Board of India) is the regulator for the securities market in India. SEBI charges a fee for all sale and purchase transactions in securities other than debt securities.

Segment	SEBI Turnover Fee Rate
Equity Delivery, Intraday, F&O	0.00010% (Rs 10/Crore) + GST
Currency F&O	0.00010% (Rs 10/Crore) + GST
Commodity Futures	Agri: 0.00001% (Rs 1/Crore) + GST Non-agri: 0.00010% (Rs 10/Crore) + GST
Commodity Options	0.00010% (Rs 10/Crore) + GST

The above fees or charges are provided in detail in the form of Contract Note by the broker.

What is Contract Note in the stock market?

Contract note, a document sent by the broker to the client at the end of the trading day to provide detail about the transaction with the broker.

This document includes detail of buy & sell transactions for the day, brokerage charged, other fees or charges applied and total amount due to customer.

The broker provides an electronic copy of the contract note (in pdf format) for free and charges an additional amount to send a paper copy by mail. One contract note is sent to the customer every day; which include all the transactions for the day with the broker.

Here is a 'Contract Note Sample' which shows all these charges:

Contract Note Sample - India Share Market

Zerodha (India's Best & No. 1 Broker)

Special Offer - Free Equity Delivery and Mutual Funds

Brokerage-free equity delivery trades.
Brokerage-free Direct Mutual Fund.
Pay ₹20 per trade for Intraday & F&O.
The best trading platform in India.

Open Instant Demat Account Read Reviews

Frequently Asked Questions

1. Can I claim for GST input (credit) for stock market transactions?

No, a stock trader in India cannot claim GST input for transactions done in the stock market.

GST Credit cannot be claimed by anyone except if they are rendering services where they are paying GST and this is as input to provide this service.

For example, Mutual Funds are paying GST on the cost charged to the corpus of the fund, and a contract note from a stockbroker is input to provide that service.

Except for PMS, AIF, and MF, no one can take GST credit.

Discuss this question

Rate this article

3.2

Rating:

Vote Here ...

6 Comments

6. Bakshi manindra kumar sinha

| Link|June 19, 2021 1:20:14 AMReply

My broker India infoline IIFL Securities gave in writing _ equity delivery 0.25 Percent but actually charges 0.52 to 2.5 percent. He have not disclosed for what amount of Rs. What commission should be charged, now I think better to switch to other broker

5. Mane Meena

| Link|August 6, 2020 1:02:52 AMReply

sir
Iam working as teacher.
My broker not explain the brokerage charges except govt duty.
When i open my new account, there advisor/office staff told me that for day trading 0.5 paisa and delivery 0.15 and iam belive the same. After four month when i just checked my account iam shocked.
the broker charges 0.10 paisa and delivery 0.20 paisa. I asked the same for the broker but he told that this is happened from hdqrs we have not done anything. Sir please help me my hard money.
Nearly 15 to 30 thousand loss. How can get me my money. Please help me sir

5.1. Saby Pinto

| Link|April 24, 2021 12:43:20 AM

Hi,
I too am currently suffering such high brokerage charged by the broker. Although, on their website they say, 0.01% or Rs.9, whichever is lower, they (my broker) charge you 0.01% "on the Share Price, then multiply with the total no of shares. so the brokerage shoots up. So my advice is, 1) study all your contract notes sent by them to you, 2) make a note of where discrepancy according to you, 3) have a word with them about it & clear it with them. If they are not ready to see sense, then......"The Exchanges provide Complaint Resolution, Arbitration and Appellate arbitration facilities at the Regional Arbitration
Centres (RAC). The client may approach its nearest centre, details of which are available on respective Exchange’s website. Please visit www.nseindia.com for NSE,www.bseindia.com for BSE." .....you can contact the RAC & lodge a complaint with them.

4. Krishna

| Link|May 2, 2018 5:47:52 PMReply

Explain CDSL Charges if possible in Angel broking

3. ASIM CHAKRABARTI

| Link|July 13, 2017 7:57:17 AMReply

Such articles are definitely required for academic purposes, but people of ordinary prudence won''t know how much to be paid for intra day & Delivery transactions of Rs 100.00

3.1. Yatindra Ranade

| Link|July 26, 2017 3:48:05 PM

typically if yoh buy and sell Shares worth Rs.100/- , then approximately Rs.1-2 (~1-2% ) will be charged in total including ALL taxes and charges fro the entire transaction

3.2. niraj

| Link|April 17, 2018 11:21:05 PM

if your brokerage is 0.3% in delivery it is near about 48-49 paisa per 100 INR

2. Amul

| Link|November 12, 2017 11:49:49 PMReply

Will there be any charge if keep holding the shares of any xyz company for 1 year?

1. cbsharma

| Link|October 5, 2017 8:32:20 PMReply

I am always in doubt about total charges. Brokers not explain rightly.n

More articles in this category...List of all Articles