« Top Headlines » Open DEMAT Account in 24 hrs  Mock Test Papers Series - I & II for Students appearing in CA Foundation January 2027 Examination.  Income Tax Rules 2026: CBDT Introduces Revised Form 161 for Penalty Waiver, Clarifies Misreporting Categories and Taxpayer Relief  ITR Filing and Income Tax Audit Deadline Extended: 5 Critical Things Taxpayers Must Know  Filing Belated ITR for AY 2026-27? Know Which Losses You Can Carry Forward and Which You May Lose  CBDT Extends Tax Audit Report Deadline to October 21, ITR Filing Last Date to November 21 for AY 2026-27  CBDT Extends AY 2026-27 ITR Filing Deadline for Tax-Audit Cases: New Dates and Key Compliance Details  Foreign Assets Missing From Your ITR? Income Tax Department Opens One-Time Disclosure Window  Tax Audit Deadline September 30: Why AIS, TDS and GST Figures May Not Match Your ITR and What Taxpayers Should Do  Tax audit deadline September 30: Common mistakes taxpayers should avoid  Your ITR says ‘verified’, but the refund hasn’t arrived? 5 reasons why your money could be stuck  Missed the ITR Deadline but TDS Refund Is Due? Here’s How You Can Still Claim Your Money «  Pieces in the Budget jigsaw... Error of judgment... » Income from stock lending is taxable February, 27th 2008 Income generated from the business of stock-lending and sale-repurchase of shares by a borrower will be taxable. TAXING TIMES The Central Board of Direct Taxes (CBDT) has exempted stock lending/borrowing from the purview of securities transaction tax (STT) and capital gains tax Borrowers will make some payment to lenders of shares by way of interest or fees that will be income in the hands of the lender While selling the shares, borrower will not be paying any tax as the gain from such sale is not known However, the Central Board of Direct Taxes (CBDT) has exempted stock lending/borrowing from the purview of securities transaction tax (STT) and capital gains tax. CBDT has issued a circular in this regard to the income tax field formations.   Borrowers will make some payment to lenders of shares by way of interest or fees that will be income in the hands of the lender.   It will be treated as income from business of lending/borrowing or income from other sources of income and will be taxable at applicable rates, said a finance ministry official.   While selling the shares, borrower will not be paying any tax as the gain from such sale is not known. But when a borrower repurchases shares to return to the lender, the margin between sale and re-purchase will be treated as profit from business or capital gains depending on the tax treatment of shares as per CBDT rules, the official said.   If the shares transacted are treated as capital assets, then short term capital gains tax will be levied at the rate of 10 per cent. If they are treated as trading asset, the tax rate could be as high as 30 per cent.   Another big issue likely to come up is - whether stock lending and borrowing will be treated as a speculative activity. According to sources, the income tax assessing officers can treat the stock lending/borrowing as speculative transaction.   That means, losses on speculative business will not be allowed to be set off against income from normal business for claiming tax refund or reducing tax liability.   According to the government official, there were two issues before the CBDT - (i) whether lending/borrowing of securities under securities lending and borrowing scheme will amount to transfer under clause 47 of the Income Tax Act, in the hands of lender?   (ii) Whether lending/borrowing of securities will be subjected to securities transaction tax?   Both the issues have been taken care of in the circular.