i have bought shares for which i have paid brockrage ,sebi fees , stamp duty , stt etc . i have also sold some shares for which again i paid brockrage,sebi fees , stamp duty , stt .
in my filing of income tax in capital gain section can i deduct the brockrage, sebi fees , stamp duty as expenses on share bought and sold(some share) or only those fees could by deducted in which i have capital gains ie by selling only
Hi @akrit
You can claim expenses directly connected to the trading business as a business expense.
Here’s a read on Expenses a Trader Can Claim in ITR - Learn by Quicko for your reference.
Can this be claimed in itr 2 since in previous years i have treated gains as capital gains and not as my business income
For a salaried person who reports capital gains (ITR-2)
So, can DP Charges(about Rs. 15) be claimed as a deduction for calculating capital gains?
Can GST charged on brokerage etc (mentioned in the contract note) be deducted as an expense for capital gains?
Thanks
Hi @S_Gupta
You can claim DP Charges while calculating STCG. Since this is an expense incurred exclusively in connection with the transfer. And it will reduce your total taxable STCG.
A trader can claim expenses such as brokerage, stamp duty, sales commission, etc. in the Income Tax Return. However, GST charged on brokerage cannot be deducted as an expense for capital gains.
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I learn that when Shares are Buy and Sale as Investment, STT is not deductible and in case of Business STT is deductible.
Pls. tell whether both STT buy and STT Sell are not deductible in case of Investment.
Second Query : While filing IT Return there are columns of CG :
3(a)(i) Full Value of Consideration, Cost of Acquisittion and Expenditure in connection with Transfer/Sale.
Here (i) Full Value of Consideration is the Sale Price of Share without deducting any bokerage etc?
(ii) Cost of Acquisittion includes Purchase Price+Brokerages etc. ?
(iii) Expenditure in connection with Transfer/Sale, here expenses for sale like brokerage etc. hv to mentioned?
or one can mention Expenditure as Zero and take the Net Sale Value as Full Value of Consideration
(as it is convenient)?
Pls. throw some light. 
- Yes, STT buy and STT sell are not deductible
- (i) Full Value of Consideration is the sale price of the capital asset, without deducting brokerage and other charges.
(ii) The cost of acquisition is the purchase price of the asset which includes all the expenses directly related to the acquisition of the asset, including the purchase price, brokerage charges, commissions, transfer fees, legal fees, etc.
iii) It is recommendable that you mention all your expenses incurred related to the sale of an asset and consider net asset value. But it is totally up to you if you want to show zero expenses and take Net Sale Value as Full Value of Consideration.
Hope this helps.
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Thank you very much. Explained very well.
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can I deduct “annual maintenance charges” I paid to my broker for calculating capital gains
I have a short term profit of 30k and long term loss of 29k so how should I deduct my expenses like brokerage and other taxes
Hi @Walker
No, you cannot deduct thec AMC (annual maintenance charges) paid to a broker for calculating capital gains.
You can claim expenses such as brokerage, stamp duty, sales commission, etc. can be claimed as an expense in your Income Tax Return.
LTCL cannot be set off against STCG, so you can carry forward the LTCL to future years.
can I also deduct pledging charges for the calculation of capital gains
Why aren’t all the taxes and charges incurred upon buying and selling equity shares in a particular F.Y. aren’t deducted from the LTCG and STCG in Quicko? The tax liability would ease off.
Hello @SAAD625,
Once you import your trading details from Zerodha, the taxes and charges incurred are automatically fetched on Quicko. However, as STT cannot be claimed as an expense while calculating capital gains, it is not reflected.
You can also refer to the following article to know that why the Tax P&L of Quicko does not match with Tax P&L of Zerodha : Help Center
Hope this helps!
While arriving at net short term capital gains or long term capital gains, can we offset the following charges?
- STT paid while purchasing and selling the shares
- Exchange transaction charges charged by the stock exchanges
- Stamp Duty charges
- DP charges: charged by CDSL whenever there is a debit of shares from the account.
Hi @swsriram
For arriving at the net capital gains, you can claim all these expenses except STT.
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Hi,
I do my investments though a portfolio management service …
capital gains is ~2,70,000 but expenses include-
Custodian fees ~6,000
Management fees ~ 3,20,000
Other expenses ~700
STT is ~2000
I think STT cannot be claimed as an expense for capital gain calculation in ITR. But which of the other expenses can I also claim?
Please help. It will make a huge difference in tax calculation.
Hi @Ashwin1
Yes, STT cannot be claimed as an expense for calculating capital gains.
Other expenses if wholly and exclusively incurred in connection with the transfer are allowed as a deduction.
Management fees and Custodian fees are expenses that are not necessary for the transfer and hence might not be allowed as a deduction.
There are contradictory views taken by different authorities of the ITD.