NSE Instructs Brokers to Report and Remit Excess STT
Synopsis
In a proactive move, the NSE has directed brokers to report any excess Securities Transaction Tax collected but not remitted to the government. This comes following a request from the Income Tax Department, emphasizing compliance and transparency in the financial sector.
Key Takeaways
NSE has mandated reporting of excess STT.
Compliance deadline set at seven days.
Interest of 1% applicable on late remittances.
Directive follows a request from the Income Tax Department .
New STT rates effective from April 1, 2026, post Union Budget.
Mumbai, March 10 (NationPress) – The National Stock Exchange (NSE) has recently instructed its trading members, including brokers and sub-brokers, to provide information regarding excess Securities Transaction Tax (STT) that has been collected but not submitted to the government for the fiscal years 2023–24 and prior years. This directive comes in light of a request from the Income Tax Department.
In a circular sent out by the finance and accounts department of the exchange, the NSE mentioned that the Joint Commissioner of Income Tax, Range 7(1), prompted the exchange to highlight instances where certain members have collected excess STT from clients yet failed to remit these funds to the government.
The tax authority has urged the NSE to disseminate a circular compelling members to disclose details of the excess STT they retain and to remit these funds to the exchange.
Trading members are required to submit their details under the title “Excess STT Retained-NSE” and must adhere to the guidelines within seven days of the circular’s release.
Additionally, they are obligated to remit the excess STT amount along with 1% interest for each month of delay to the National Stock Exchange of India Ltd, which will then transfer the total to the government treasury.
The exchange also noted that this latest communication follows its previous notification dated March 19, 2025, regarding excess STT retained by members for the fiscal year 2022–23 and earlier years.
Moreover, the NSE emphasized that the disclosures must encompass the excess STT collected and held for FY 2023–24 and prior years as of March 31, 2023, and it encouraged members to settle these dues promptly along with the applicable interest.
In the Union Budget for 2026, Finance Minister Nirmala Sitharaman revealed an increase in STT on futures, more than doubling it from 0.02% to 0.05%. Additionally, the STT on options premium and the exercise of options has also risen to 0.15%, up from the previous rates of 0.1% and 0.125%, effective April 1, 2026.
Point of View
The NSE's directive represents a significant step towards ensuring accountability among trading members. This measure not only aligns with regulatory compliance but also reinforces the integrity of the financial marketplace.
NationPress
9 May 2026
Frequently Asked Questions
What is the deadline for brokers to report excess STT?
Brokers must comply with the NSE's directive within seven days of the circular's publication.
What happens if brokers fail to remit the excess STT?
They will be required to remit the excess STT along with 1% interest for each month of delay.
What fiscal years does the NSE's directive cover?
The directive covers FY 2023–24 and preceding years.
Why is the NSE issuing this circular?
The circular is issued following a request from the Income Tax Department to ensure compliance regarding excess STT collection.
What changes were made in the STT rates during the Union Budget 2026?
The STT on futures was increased from 0.02% to 0.05%, and the rates for options premium and exercise have also been raised.
