Brokers may deduct 10% tax on transaction charges for online trading

Nov 8

Brokers may deduct 10% tax on transaction charges for online trading

MUMBAI: Share brokers may have to deduct 10% tax at source on transaction charges that they pay to stock exchanges for online trading, according to a court order. The move will have a bearing on thousands of brokers who will now have to pay TDS along with interest for delayed payment.

Transaction charge is a fee incurred on buying or selling shares, which a broker pays to stock exchanges for being the middleman in a share transaction.

The Bombay High Court said stock exchanges give managerial services and transactions charges are the fee for “technical services” and liable to be taxed.

Source: http://articles.economictimes.indiatimes.com/2011-11-07/news/30369554_1_transaction-charges-online-trading-levy-tax

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