CTT exemption

Derivatives on unprocessed agricultural commodities are exempt from CTT; processed ones are not — so sugar, guar gum, soya oil and all metals and energy contracts are taxed.

This one is not written up yet

The definition above is the short version. A full explanation — how it works, a worked example and the exam traps — is still being written. In the meantime the chapter below covers it in context.

Written up from the same chapter

Fair valueThe theoretical futures price — spot plus the cost of carrying the commodity to expiry — at which a buyer is indifferent between buying today and buying forward.

Where this is taught

Series XVI · Chapter 9: Accounting and Taxation

Free preparation for NISM Series XVI

Related terms

Commodity Transaction TaxA transaction tax on non-agricultural commodity derivatives — 0.01% on the sale of a futures contract, paid by the seller, with separate rates for options.

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