GST registration and GST returms for equity/EQUITY derivative, commodity dervative trader

Taxation
1

Hi,
I want to know wheather a EQUITY OR EQUITY DERIVATIVE or commodity derivative trader 1)needs to Register for GST???
and
2) file GST return?

2

Short Answer: No. You need your PAN, a bank account and a demat account to map to your trading account.
Some documents such as address proofs, income proofs, etc. will be required.

Refer here.

Hope this helps. Cheers.

3

Yes, both Equity/Equity Derivative and Commodity Derivative traders are required to register for GST and file GST returns, but it depends on certain conditions:

  1. GST Registration Requirement:

  • As per GST law, anyone engaged in the supply of goods or services, and whose aggregate turnover exceeds the prescribed limit (which varies based on the nature of the business and state), must register for GST.

  • For equity and commodity derivative traders, if their turnover exceeds ₹20 lakhs (₹10 lakhs for special category states), GST registration is mandatory.

  • If a trader’s turnover is below this threshold, they may not need to register. However, opting for voluntary registration is also allowed, which can be beneficial for availing input tax credits (ITC) on business expenses.

  1. GST Return Filing:

  • Once registered, GST return filing is required on a regular basis. Traders must file GSTR-1 (details of outward supplies), GSTR-3B (summary of GST liabilities), and any other applicable returns.

  • As trading in securities or commodities does not attract GST (securities trading is exempt), traders are generally required to file GST returns to maintain compliance but may have no tax liability if the transactions fall under the exempt category.

  • Additionally, GST is applicable on service charges (brokerage, transaction fees, etc.) involved in trading activities.

Important Notes:

  • GST on brokerage and transaction fees: Even though trading in securities is exempt from GST, the brokerage and other charges are subject to GST. Therefore, traders should register for GST if they are paying GST on such services.

  • GST on other activities: For any other activities like providing advisory services, GST may apply, and in that case, the trader would be liable to register and file returns accordingly.

Conclusion

If your turnover exceeds the threshold, you must register for GST and file returns. Even if you are under the threshold, voluntary registration can be a good idea to claim input tax credits on your business-related expenses. If you still need professional assistance, feel free to connect with any GST Expert like Setindiabiz, etc.

4

Get registration isn’t required for equity/derivative traders irrespective of turnover.

Had to post on an old thread as the user above me posted wrong info today :sweat_smile: