Comment on STT Trap - Options Expiry - NSE BSE MCX-SX

eztrader commented on 25 Jul 2013, 09:26 AM

Hi,

Quick question: Is STT applicable when I buy back my previously sold call or put option and let it expire In-the-money ?

In other words, What is applicable STT Rate for following set of transactions:

1. Sell Put or call option at SP: X for premium P. applicable STT is
0.017 % on premium amount.

2. Buy that same option (i.e. put or call) at same SP: X for premium Q.
At the time of expiry, options are In-the-money…

Is STT applicable at the rate of 0.125 % on settlement price of underlying index or stock?

if No, then does applicability of STT change with strikeprice? meaning sell for SP X and buy for SP Y (different than X).

If Yes, then whoever buys that in-the-money option LAST have to pay STT. Meaning government is sure of STT income for all the in-the-money option contracts, right?

please advise.

thanks
ez.

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