Place of business for stock broker : CBIC Clarify

By | June 4, 2018
(Last Updated On: June 4, 2018)

What is the “place of business” for a  stock broker?

Section 2(85) of the CGST Act, 2017 defines “place of business” to include:

(i) a place from where the business is ordinarily carried on, and includes a   warehouse, a godown or any other place where a taxable person stores his goods, supplies or receives goods or services or both; or
(ii) a place where a taxable person maintains his books of account; or
(iii) a place where a taxable person is engaged in business through an agent, by whatever name called.
In case of operations of a stock broker, it is required by law that all transactions  would be via screen based trading on the Stock Exchanges.

Therefore, the following would be the “place of business” in case of stock brokers:

(i) All the branches of the stock broker where the Stock Exchange Trading terminals are located and where trade is carried out on behalf of clients;
(ii) Main office/ Head office/ Registered Office/ Branch office where back office operations are carried out including issuing of bills/ contracts/ tax invoices/ account statements to the clients.

In case of sub-brokers’ / Authorised Person office, where the premises are  neither owned by the stock broker nor rented/ leased in favour of the stock broker and there are no employees on the payroll of the stock broker in such an office, then such premises shall not be considered a place of business of the stock broker.

Q 84 of GST FAQs on Financial Services Sector published by CBIC

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