Rules, not opinions
The F&O rules that changed
Six changes SEBI made to index F&O. All six apply today. The dates below are the circular’s own, not a summary of them.
Full premium upfront
1 Feb 2025Your broker has to take the whole option premium from you before the buy goes through.
No spread benefit on expiry day
1 Feb 2025A position expiring today no longer offsets one expiring later, so you pay more margin.
Limits checked during the day
1 Apr 2025Exchanges now check your position limits at least four times a day, at random, not just at the close.
One lot is now ₹15–20 lakh
20 Nov 2024A contract has to be worth at least ₹15 lakh. It used to be ₹5–10 lakh, a level set back in 2015.
One weekly expiry per exchange
20 Nov 2024Each exchange can offer a weekly expiry on only one of its main indices, instead of one every day.
Extra 2% margin on expiry day
20 Nov 2024If you are short options expiring that day, you pay an extra 2% margin on them.
| What changed | What it means for you | Since |
|---|---|---|
| Full premium upfront | Your broker has to take the whole option premium from you before the buy goes through. | 1 Feb 2025 |
| No spread benefit on expiry day | A position expiring today no longer offsets one expiring later, so you pay more margin. | 1 Feb 2025 |
| Limits checked during the day | Exchanges now check your position limits at least four times a day, at random, not just at the close. | 1 Apr 2025 |
| One lot is now ₹15–20 lakh | A contract has to be worth at least ₹15 lakh. It used to be ₹5–10 lakh, a level set back in 2015. | 20 Nov 2024 |
| One weekly expiry per exchange | Each exchange can offer a weekly expiry on only one of its main indices, instead of one every day. | 20 Nov 2024 |
| Extra 2% margin on expiry day | If you are short options expiring that day, you pay an extra 2% margin on them. | 20 Nov 2024 |
Where this is from
- From
- SEBI circular SEBI/HO/MRD/TPD-1/P/CIR/2024/132, 1 October 2024 — Measures to Strengthen Equity Index Derivatives Framework for Increased Investor Protection and Market Stability.
- Applies to
- Equity index derivatives, at every stock exchange and clearing corporation except commodities.
- Checked
- Read in full, all 8 pages, on 4 October 2026. The dates above come from the circular's own table, not from anyone's summary.
What this means at tax time
Your F&O profit is business income
Not speculative income. So a loss can be set against anything except your salary, and carried forward for eight years — as long as you file on time.
Income Tax Act, s.43(5) and s.72. You file ITR-3.
Turnover is not what the contract was worth
For F&O, turnover means adding up the profit or loss on each trade. A ₹16 lakh contract that made ₹8,000 adds ₹8,000 — not ₹16 lakh. That difference decides whether you need an audit.
Worth checking your own case with a CA. This is the rule, not advice on your return.
What this does not say: Nothing here tells you what to trade, when, or how much. These are simply the rules the segment runs on.