Why does less money come into the account than when the shares are sold?

Many investors get confused when opening mobile banking after selling shares. The amount in the bank account is slightly less than the amount shown in the transaction system. A new investor may think at that time - "I sold shares worth so much rupees, why is there less in the account?" This question confuses many. Some suspect that the broker took more money. Some start to wonder if there is a glitch in the system. But when the sales amount in the stock market comes to the bank account, the total transaction amount and the actual amount received are not the same.

The amount shown at the time of sale is the total selling price of the shares. But the amount deposited in the account is the final receipt. In between, some regular fees and taxes related to market transactions are adjusted. For this reason, the amount shown in the transaction system and the amount received in the bank account will be different. There are mainly four types of deductions that can be deducted from the total amount after the shares are sold—broker commission, securities board fee, depository member fee and capital gains tax in case of profit. At present, broker commission on equity share transactions is seen at published rates ranging from 0.36 percent to 0.24 percent depending on the transaction amount. 0.36 percent for transactions up to 50 thousand rupees, 0.33 percent for transactions up to 50 thousand 1 rupees to 5 lakh rupees, 0.31 percent for transactions from 5 lakh 1 rupees to 20 lakh rupees, 0.27 percent for transactions from 20 lakh rupees to 1 crore rupees and 0.24 percent for transactions above 1 crore rupees.

In addition to this, the securities board fee is 0.015 percent of the transaction amount. This fee applies to both buying and selling of shares. The deposit member fee is usually Rs. 25 per company per trading day. In the various broker and investment fee details, the securities board fee is 0.015 percent and the deposit member fee is Rs. 25. The amount that makes the most difference may be the capital gains tax. If the shares are sold at a profit, the profit amount is taxed. According to the published fee statement, the rate of capital gains tax is 7.5 percent for individual investors who sell shares held for less than one year at a profit and 5 percent for the sale of shares held for more than one year at a profit. In case of institutional investors, such tax is 10 percent.

Now let's understand with an easy example. Suppose you sell 100 shares of a company at Rs 500 per share. The total sales amount was Rs.50,000. If the average purchase cost of that share was Rs 400 per share, your total cost would be Rs 40,000. In this way, the total profit was Rs. 10,000. If the shares were held for less than one year, the capital gains tax is 7.5% on the profit of Rs 10,000. This means a tax deduction of Rs.750. Apart from that, 0.36 percent broker commission is deducted for a transaction of Rs 50,000, which is around Rs 180. The Securities Board Fee is Rs 7 50 paise at the rate of 0.015 per cent. The deposit membership fee is Rs. Thus, in a sale of Rs.50,000, the full Rs.50,000 does not come to the account.

Description amount Total sales amount Rs. 50,000 Broker commission, 0.36 percent Rs. 180 Securities Board Fee, 0.015 percent Rs. 7.50 Deposit member fee Rs. 25 Capital gains tax, profit Rs. 7.5 percent of 10,000 Rs. 750 Estimated amount coming into the account Rs. 49,037.50 If the same shares were held for more than one year, the capital gains tax would have been only 5 percent instead of 7.5 percent. In that case, the tax would be only Rs 500 on a profit of Rs 10,000. As the tax is less, the amount coming into the account would be a little more.

Capital gains tax is not charged if the shares are sold at a loss, as capital gains tax is levied only on profits. But even selling at a loss incurs broker commission, securities board fees and depository member fees. Therefore, even from the shares sold at a loss, the total sale amount does not come to the bank account. Average purchase cost is also important in this. If the shares of the same company are bought at different times at different prices, the profit or loss is calculated on the basis of average cost. If the average cost is high, the profit will appear low and the tax may also be low. If the average cost is lower, the profit will be higher and the tax may be higher.

So it is not a mystery why less money comes into the account than when the shares are sold. The amount initially displayed in the trading system is the total sales amount, but the amount credited to the bank account is the actual amount remaining after deducting broker commission, securities board fees, depository member fees and capital gains tax on profits. /* Blue toned WordPress table */ table { width: 100%; border-collapse: collapse; margin: 24px 0; font-size: 16px; font-family: inherit; color: #1e3a5f; background: #ffffff; border: 1px solid #b7d7f0; box-shadow: 0 4px 14px rgba(30, 90, 150, 0.12); border-radius: 10px; overflow: hidden; }

table thead { background: linear-gradient(135deg, #0d6efd, #0a58ca); color: #ffffff; } table th, table td { padding: 14px 16px; border: 1px solid #d6e9f8; text-align: left; vertical-align: middle; } table th { font-weight: 700; letter-spacing: 0.3px; } table tbody tr:nth-child(even) { background: #f1f8ff; } table tbody tr:nth-child(odd) { background: #ffffff; } table tbody tr:hover { background: #dff0ff; transition: background 0.2s ease; }

table caption { caption-side: top; padding: 12px; font-weight: 700; color: #0a58ca; } /* Mobile friendly */ @media (max-width: 768px) { table { display: block; overflow-x: auto; white-space: nowrap; } }