13.6What is STT (Securities Transaction Tax)?
Time-sensitive: Futures (0.02%→0.05%) and options (0.1%→0.15% on premium; exercise 0.125%→0.15%) STT changed by Budget 2026, effective 1 April 2026. Checked November 2026 for FY 2026-27. Verify on incometaxindia.gov.in, NSE, BSE or SEBI before filing or trading. Rules and rates change, so check the official source before acting.
1What is it?
STT is a tax on the value of each trade on a recognised exchange, collected by the broker for the government.
2Why does it exist?
It is a simple way to collect tax on market activity. Paying STT is also a condition for the concessional capital gains rates.
3Diagram
| Transaction | STT rate | Paid by |
|---|---|---|
| Equity delivery: buy | 0.1% | Buyer |
| Equity delivery: sell | 0.1% | Seller |
| Equity intraday: sell | 0.025% | Seller |
| Futures: sell | 0.05% | Seller |
| Options: sell (on premium) | 0.15% | Seller |
| Options: exercised (on intrinsic/settlement value) | 0.15% | Buyer |
| Equity mutual fund: redemption | 0.001% | Seller |
4Quick revision
- Tax on trade value.
- Rates differ by segment.
- F&O rates rose from April 2026.
5Knowledge check
Q1. STT on equity delivery?Show answer
0.1% on both buy and sell.
Q2. STT on futures sell (from April 2026)?Show answer
0.05%.
Q3. STT on options sell (from April 2026)?Show answer
0.15% of premium.