Dear traders toady I will explain how to calculate your total tax paid for trading a one lot of nifty future. Let us all start with the basic. Total amount required to open position in one lot of nifty is Rs.27,000 (approx). This is known as margin amount required to for 1 lot of open position. A trader will need this much amount to buy or short sell Nifty future contract.

Let us calculate taxes:

Consider if we buy one lot of nifty future. One lot of nifty future has 50 quantities. As said earlier we only pay margin amount and not the full amount, which is very big.
Here full amount will be = 5300 x 50 (current price X quantity)
Full amount is 2,65,000.
But we only need Rs.27,000 as the margin amount to hold one lot of nifty future.

Brokerage on Buying Nifty future

My current broker is offering me brokerage of 0.02 paise for buying and 0.02 paisa for selling on any future contract.
Brokerage for buying one lot of nifty future is
Rs.2,65,000 x 0.02/100 = Rs.53

Now Calculate Taxes for Buying side

Along with brokerage, trader has to pay some taxes also here are two tax which every trader pays:
1. Service Tax (ST) = 12.36% – ST is calculated on brokerage only. However it applies on both buying & selling brokerage amount.
2. Regulatory + stamp duty charges is = 0.004%. This is applied on both buying and selling amount. So this is applied on total contract value see below example.

1. Service Tax is calculated only on brokerage current rate is 12.36%
In our above example, the brokerage has come to Rs.53
Hence, 53 x 12.36/100 = Rs.6.55

2. Regulatory charges and stamp duty charge is 0.004% of total contract amount.
The buying amount is 2,65,000
So, 2,65,000 x 0.004/100 = Rs.10.6
Hence total taxes you need to pay for buying nifty future is Rs.6.55 + 10.6 = 17.15

Now the total amount you have to pay to broker including the brokerage & taxes for buying 1 lot nifty future is
Brokerage Amount = Rs.53
Total Taxes = Rs.17.15

Total amount comes to Rs.70.15

Total brokerage calculated on Selling side
My brokerage for selling nifty future is 0.02% of total amount
Total selling amount is 5300 x 50 = Rs.2,65,000
So Brokerage is 2,65,000 x 0.02/100 = Rs.53

Taxes calculation for Selling Nifty future:

It is simple as we have done for buying side but now let us see taxes for selling nifty future:
1. Service Tax (ST) is 12.36% – It is calculated on brokerage amount only.
2. STT (Security Transaction Tax) is 0.017% – STT is calculated and applied on selling side, this doesn’t apply on buying nifty future.
3. Regulatory + stamp duty charges so total percentage is 0.004%.

Current rate of service tax is 12.36%, Service tax is calculated on brokerage charged and brokerage on selling amount is Rs.53
53 x 12.36/100 = Rs.6.55

Security Transaction Tax (STT):

It is only applied on total selling amount value, current STT rate is 0.017%
Here in this example selling amount is 2,65,000.
Hence 2,65,000 x 0.017/100 = Rs.45.05

Regulatory and stamp duty charges are calculated at the rate of 0.004% of selling amount, Here selling amount is 2,65,000
Hence 2,65,000 x 0.004/100 = Rs. 10.6

Total Taxes you need to pay on Selling nifty future is 6.55+45.05+10.6 = Rs. 62.2

The total amount you have to pay to broker including the brokerage & taxes for Selling one lot of nifty future
Brokerage is Rs.53
Total Tax is Rs.62.2
Total amount comes to Rs.115.2

Total brokerage and taxes you pay for buying and selling one Nifty Future contract:
The buying and selling brokerage + buying and selling taxes Which comes to, Buying amount including taxes and brokerage is Rs.70.15.
Selling amount including taxes and brokerage is Rs.115.2
So total amount comes to Rs.185.35, A trader must earn more than 4 points in nifty future to be at breakeven.

Your Net profit:

1) If you exit nifty future with 10 points profit then it comes to Rs 500 per lot and after bearing the charge of Rs.185.35, your net profit comes to Rs.314.65 for one lot.
2) If take profit of 15 points for one nifty lot then it comes to Rs 750 per lot (Rs 15 x 50 quantity) and after deducting the charges of Rs.185.35, your net profit comes to Rs 564.65 for one lot trade. You can join our technical analysis course to learn more.