Searches like “STT paid on sale of shares allowed as deduction” have a short answer that depends on your head of income. Investors taxed under capital gains generally cannot deduct STT. Traders reporting business income often can.
Use this guide to classify your facts, then open the income-tax desk for ITR positioning or a notice reply if the department has questioned your claim.
Who this is for
- Salaried and HNIs with listed share capital gains wondering about STT
- Share traders reporting business income who want Section 36(1)(xv) clarity
- Assessees who received a notice questioning STT or trading vs investment
- Finance teams preparing ITR working papers for equity portfolios
How we work
- 01
Decide investor vs trader on facts
Volume, intent, holding period, and books decide whether income sits under capital gains or business — not labels alone.
- 02
Apply the correct STT rule
Capital gains: STT is generally disallowed under Section 48 of the Income-tax Act, 1961 (Section 72 of the Income-tax Act, 2025). Business income: STT may be deductible under Section 36(1)(xv) of the Income-tax Act, 1961 (corresponding deductions under Section 29 of the Income-tax Act, 2025) when conditions are met.
- 03
Document the ITR position
Match broker statements, STT totals, and schedule disclosures so AIS and the return tell the same story.
What you receive
- Investor vs trader assessment note
- STT deductibility position under Sections 48 / 36(1)(xv)
- ITR working-paper support
- Notice reply support if STT was questioned
Common questions
Direct answers for searchers and answer engines
It depends. If share profits are taxed as capital gains, STT is generally not deductible (Section 48 of the Income-tax Act, 1961 / Section 72 of the Income-tax Act, 2025). If the transactions are business and income is taxed as business income, STT may be deductible under Section 36(1)(xv) of the Income-tax Act, 1961 (corresponding business deductions under Section 29 of the Income-tax Act, 2025) when statutory conditions are met.
Generally no for the STT amount disallowed under the capital-gains computation rules. Confirm the year’s law and your facts with a CA before filing.
Yes. The income-tax desk prepares factual submissions and representation packs when scrutiny questions STT or the investor/trader characterisation.
Share broker contract notes or annual STT summaries via WhatsApp +91-8882913461 or the contact form.