SUB-BROKER TO BE ADDED THE BROKER CENTRALIZED REGISTRATION OR NOT

[Asked by Guest]

Dear Sir,

The company nature of business is stock broking. it is registered under NSE and BSE as per SEBI regulation. The assessee was created sub-brokers in all around India. The revenue has been generated from own branches as well as sub-brokers. The company is centralized service tax registration for their own branches not for sub-brokers. But entire broking charges are taxable at the hand of stock broker not from the sub-broker as per amendment M.F. (D.R.) letter D. O. F. No. 334/13/2009-TRU dated 06.07.2009.

 

My question is : Whether SUB BROKER to be added the stock broker centralized registration or NOT

[YAGAY and SUN]

There is no requirement to include the sub broker in the Centralized Registration Certificate.

Thanks for your instant repy. pls provide if you having any notification or circular relating to non requirement of sub-brokers not to be added with stock broker centralized registration.

[Vivek Harsh]

Notification No. 31/2009 -ST dated - 01-09-2009 Exempt Services in relation to sale or purchase of securities listed on a registered stock exchange by a sub-broker................my view is that when stock brokers are exempt from services question of adding SUB BROKER to  stock broker centralized registration or NOT doesnot arise.

[DEV KUMAR KOTHARI]

Replies of learned readers is correct. There is exemption for services of sub-brokers, the exemption is also with a view to simplify the admininstration becasue in case sub-brokers are not exempted, their services shall be input service to main broker/ member of S.E. and they will get credit for tax if levied by sub-broker. Therefore, sub-brokers need not be added in Centralized Registration.

AI Summary

Sub-broker exemption means sub-brokers need not be added to a stock broker's centralized service tax registration.
Broking charges for transactions in listed securities are taxable at the stock broker's hands and a notification exempts sub-broker services in relation to sale or purchase of securities on a recognized exchange; therefore sub-brokers need not be added to the stock broker's centralized service tax registration, avoiding input tax credit and administrative complications.