Buy shares from a friend vs buy from exchange

Stocks
1

What would be the pros and cons of buying shares from another person who is willing to sell (not through exchange)

is the transfer takesplace via DIS slips?
STT, Exchange charges, GST & sebi charges applicable?

2

@Muniz.Reza : The transaction will be off market through dis slip thus no stt /gst /st payable and no tax benefit on sale if there is profit at that time.

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3

@sabkaview Thanks for you reply.

What would be the tax implications on Off market transactions…

4

whole profit will be added to your income be it short term or long term and your tax slab may increase accordingly . if even after adding such gains if any your income is below taxable limit no tax .

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5

I dont see that there are some implications of buying shares from private individual and off market, except that in other case you can negotiate lower purchasing price. The tax implications are generally the same as everything else

6

@ since all off market transactions are non stt and gst paid , there will be no LTCG exemption on such trade and even short term gains will be clubbed with your income .

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7

So basically there is really no point at all anyway on all that matters for example, I do see how it’s all going and that’s really it. You assumed you can be save on taxes but the whole reason where you can save is simply in something like buying lower from friend.

8

Off market transactions normally do take place in unlisted or d listed shares . there are many dealers who on there website do display last dealt / negotiated price on website .

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9

It will be very difficult to answer your question until you specify quality and value of stock. In my opinion doing transaction over exchange is always more convenient than physical transaction.

e.g if you are transferring stock worth 1 lakhs through Zerodha

A. through exchange and DEMAT - 103.93 approx + Additional charges (refer https://zerodha.com/brokerage-calculator)

B. Through DIS slip

DIS booklet charges - 100 rs (the first 10 leaves are free)

0.03% of turnover or Rs 25, plus 18% GST (Higher of two)

So yeah, you will save some money if you transfer using DIS slip. Process involve long procedure which will takes more time to transfer stocks. If particular script is available in BSE/NSE, it will much easier and lesser expensive to buy it in stock exchange.

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10

Off market transactions through DIS slip can be executed instantly even few minutes before dp closer time at very nominal same day extra charges which are rs 25 plus taxes . in normal course too , it will be done by next working day .

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