NSE asks brokers to disclose and remit excess STT collected for FY24 and earlier

NSE asks brokers to disclose and remit excess STT collected for FY24 and earlier

• NSE asks brokers to report and return excess STT collected
• Brokers must remit excess STT with 1 percent monthly interest
• STT collections rose from Rs 33,778 cr in FY24 to Rs 52,197 cr in FY25

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NSE has asked brokers to report and return any excess Securities Transaction Tax (STT) collected but not deposited with the government for FY 2023-24 and earlier years, following directions from the Income Tax Department. STT is collected on buying and selling of securities.

In a circular issued on Tuesday, NSE said the instruction follows a communication from the Joint Commissioner of Income Tax, Range 7(1), which flagged that some brokers had collected STT in excess of the required amount and retained it instead of remitting it to the government account.

According to the circular, brokers and sub-brokers have been asked to furnish details of excess STT collected and retained as of March 31, 2023 directly to the exchange. Brokers must submit the information with the caption “Excess STT Retained – NSE” and comply within seven days of the circular’s publication.

NSE circular quoted Joint Commissioner of Income Tax letter dated March 5 stated “it is requested that a circular may kindly be issued requesting all the Member, Brokers/Subbrokers to furnish the details of such excess STT collected and retained with them for F.Y. 2023- 24 and preceding years as on 31.03.2023 directly to ‘NATIONAL STOCK EXCHANGE OF INDIA LTD.’ under intimation to this office”.

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The exchange said brokers must also remit the excess STT along with interest at 1 percent for every month of delay to NSE immediately under intimation to the income tax department. The exchange will then deposit the recovered amount into the government account.

The circular is a follow-up to an earlier NSE communication dated March 19, 2025, which had sought similar disclosures for FY 2022-23 and prior years. The Income Tax Department had requested the exchange to issue the circular and ensure compliance, noting that the recovery process should be completed promptly and the collected amounts deposited with the government without delay.

NSE circular concluded, “As per the above instruction from the Income Tax department, this circular is issued to the members requesting to furnish details of excess STT collected and retained with them for FY 2023-24 and preceding years as on March 31, 2023 to us and remit the excess STT with interest immediately”.

Exchange has also appointed designated officials who can clarify in case of any doubts to brokers related to this matter.

STT collection going up 

Introduced in the year 2004, STT is a low cost and a steady source of revenue from markets. Collections have shown a steady rise over the past five years, increasing from Rs 23,191 in FY22 to Rs 25,085 in FY23 and further to Rs 33,778 in FY24. The growth accelerated sharply in FY25, with collections jumping to Rs 52,197. For FY26, collections are estimated to reach Rs 63,670 as per the revised estimates, indicating a continued upward trend. The data highlights a significant surge in the later years, particularly between FY24 and FY25, reflecting a sharp expansion in collections.

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