Hi, you may invest in shares.
I am a central govt emplyee. My gross annual salary is over 16 lack per anum as per 7th pay commission. Can I open my own demat account and invest in shares? I understand I am not allowed in trading. But am I allowed to buy shares through my own demat account, keep it for about 6 month to an year or so and sell?
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Hi, you may invest in shares.
Investments in shares, debentures and mutual funds can be made by the Government servant. However "frequent buying and selling" of these are considered as "speculation" and is banned. Investment in shares, mutual funds etc are to be intimated to the Department at the end of every calender year as per the DoPT OM No. 11013/6/91-Estt. (A) dated 8.4.92 regarding CCS [Conduct] Rules, 1964Transactions in sale and purchase of shares and debentures etc.
1) To save tax and invest in long term as per government rule, so you can purchase it and show it to Income tax declaration and get rebate on taxes. So you can Invest in shares.
You are at liberty to invest in shares open a demat account for investment purposes
You can sell your shares if you so desire
You may make the investment in the shares and by and sell and can show the profit as your long and short term capital gains through your demat account.
There is no restraint in investing in shares. debentures or mutual fund for an government employee.
However only thing while doing so is to declare those assets at the time of filing Income Tax Return .
So except to pay income tax there is no hindrance in investing shares by a government employee.
1. You shall have to understand the difference between trading and investing.
2. Being a Govt. employee, you can not engage yourself with any other business and trading of shares is a trading business.
3. Whereas investment in shares is absolutely permissible for the Govt Employees.
It is not direct business and if you have any doubt then you may seek permission of your boss and after getting permission only you can start business in shares. Anyway you have to disclose all your income in your annual property assessment statements and IT returns. If your boss reject your proposal then you may approach High Court since the Constitution of India protects your right to privacy and business without effecting the present Central Government Service, since you are not doing the said business either part time or full time but being operated by your broker.
There is no restriction to invest in the share market for long term or short term until and unless it is not a trading account.
Investment in shares and mutual funds are authorised and recognized rather encouraged by the government itself announcing various benefit schemes in mutual fund investment for the government employees.
Yes you can do the same.
there is no bar on you to invest your money.