Cost of acquisition of unlisted shares
This query is : Open
01 August 2014
Dear experts,
Mr. X was offered in FY 2010-11 ESOPS of 100 Shares of unlisted company valued by them @ 1000/=.
The company has deducted TDS @30%.
Mr. X has sold these shares in 2013-14 FY for
200000/- to Mr.Y in a private transaction as shares are unlisted.
My queries are:
1. What will be the cost of acquisition - 1000/- per share or 700/- per share?
2. What will be the capital gains?
3. Will indexation can be done for the same?
What rate is it to be taxed?
Mr. X was offered in FY 2010-11 ESOPS of 100 Shares of unlisted company valued by them @ 1000/=.
The company has deducted TDS @30%.
Mr. X has sold these shares in 2013-14 FY for
200000/- to Mr.Y in a private transaction as shares are unlisted.
My queries are:
1. What will be the cost of acquisition - 1000/- per share or 700/- per share?
2. What will be the capital gains?
3. Will indexation can be done for the same?
What rate is it to be taxed?
02 August 2014
In my opinion.
1. The cost of acquisition would be Rs. 1,000 per share.
2. You can use 10% without indexation and 20% with indexation to compute capital gain tax liability.
3. Answered above.
1. The cost of acquisition would be Rs. 1,000 per share.
2. You can use 10% without indexation and 20% with indexation to compute capital gain tax liability.
3. Answered above.
02 August 2014
Dear Sir,
Will section 112 provisions are not applicable?
Will section 112 provisions are not applicable?
03 August 2014
The above advice is as per Sec 112 (1)(a).
03 August 2014
Dear Mr. Bajaj,
Section 112 (1) (iii) says that gains on unlisted shares after 01.04.2012 will be taxed @ 10% and no indexation will be allowed.
The newly added tax relief provision u/s 112 as per Finance Act 2012 is as under :
In section 112 of the Income-tax Act, in sub-section (1), with effect from the 1st day
of April, 2013,—
(A) in clause (c), for sub-clause (ii), the following sub-clauses shall be substituted,
namely:—
“(ii) the amount of income-tax calculated on long-term capital gains [except where
such gain arises from transfer of capital asset referred to in sub-clause (iii)] at the
rate of twenty per cent; and
(iii) the amount of income-tax on long-term capital gains arising from the
transfer of a capital asset, being unlisted securities, calculated at the rate of
ten per cent on the capital gains in respect of such asset as computed
without giving effect to the first and second proviso to section 48.”;
Section 112 (1) (iii) says that gains on unlisted shares after 01.04.2012 will be taxed @ 10% and no indexation will be allowed.
The newly added tax relief provision u/s 112 as per Finance Act 2012 is as under :
In section 112 of the Income-tax Act, in sub-section (1), with effect from the 1st day
of April, 2013,—
(A) in clause (c), for sub-clause (ii), the following sub-clauses shall be substituted,
namely:—
“(ii) the amount of income-tax calculated on long-term capital gains [except where
such gain arises from transfer of capital asset referred to in sub-clause (iii)] at the
rate of twenty per cent; and
(iii) the amount of income-tax on long-term capital gains arising from the
transfer of a capital asset, being unlisted securities, calculated at the rate of
ten per cent on the capital gains in respect of such asset as computed
without giving effect to the first and second proviso to section 48.”;
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