1. What is STT?

STT (Securities Transaction Tax) is a tax levied on every transaction done on the stock exchanges in India. Zerodha, like all brokers, collects this tax on behalf of the government.

2. How Does the Calculator Work?

The calculator uses the STT formula:

Where:

• \( Turnover \) — Total value of the transaction in ₹
• \( 0.001 \) — STT rate (0.1% of turnover)

Explanation: For every ₹100 traded, ₹0.10 is charged as STT.

3. Importance of STT Calculation

Details: Calculating STT helps traders understand their transaction costs and plan their trading strategies accordingly. It's an essential component of overall trading costs.

4. Using the Calculator

Tips: Enter your total turnover in ₹ (Indian Rupees). The calculator will compute the STT charged by Zerodha at the standard rate of 0.1%.

5. Frequently Asked Questions (FAQ)

Q1: Is STT the same for all brokers?
A: Yes, STT rates are mandated by the government and are the same across all brokers in India.

Q2: Are there any exemptions from STT?
A: STT is applicable on all equity transactions. Some debt instruments may have different rates or exemptions.

Q3: How is STT different from brokerage?
A: STT is a government tax, while brokerage is the fee charged by your broker (Zerodha) for their services.

Q4: When is STT deducted?
A: STT is deducted at the time of the transaction itself and appears in your contract note.

Q5: Can I claim STT as tax deduction?
A: Yes, STT paid can be claimed as a deduction under Section 88E of the Income Tax Act for traders.