How to Read a Contract Note?

1. Header Section

• Broker & Client Details: Name, Logo, SEBI Registration No of Broker, Address, and contact information of the broker and client.
• Trade Date: Date of transaction execution.
• Settlement Date: The date when the trade must be settled (T+1 cycle in India).
• Settlement Number: Unique identifier for the settlement cycle.

2. Trade Details

• Brokerage: Fee charged by the broker for executing the trade.
• GST: 18% tax on brokerage.
• SEBI Turnover Fee: 0.0001% of the turnover (charged by SEBI).
• Stamp Duty: State-specific duty on trades (e.g., 0.003% for equity delivery trades).
• Exchange Transaction Charges: Fee levied by the stock exchange.
• Net Amount Payable/Receivable: The final amount you owe or will receive after all deductions.

1. Transparency: Verify trade execution prices, timestamps, and charges.
2. Accuracy: Ensure no discrepancies in quantities or brokerage.
3. Compliance: Aligns with SEBI regulations to protect investor interests.
4. Record-Keeping: Essential for tax filing and audit purposes.

• Standardized Format: Uniform structure across all brokers for easier comparison.
• Enhanced Disclosure: Clear segregation of charges, taxes, and obligations.
• Digital Accessibility: Contract notes are now mandatory in electronic format for easy access.

• Net Total Before Levies: ₹-50,000 (Pay-in obligation).
• Total Charges & Taxes: ₹1,200.
• Net Amount Payable: ₹-51,200 (You owe ₹51,200 to settle the trade).

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