What will happen if I don't square off my Option contract on expiry day?
If you have bought options: -
- In the money: STT on exercised contracts will be charged at 0.125% of the intrinsic value (in-the-money amount), not the total contract value.
- Out of the money: The option contract will expire worthless, and you lose the entire premium paid.
If you have shorted options: -
- STT is only charged on the sell-side. If the contract is out of the money, you keep the premiums received.