27 February 2013
Hello Experts.. My situation is somewhat typical.
I was living out of India till Dec 2004. No tax in India before that.
When I arrived to India in 2005 and brought my money from outside . I initially held FCNR( Foreign currency NOn resident) account which I broke and put money ( INR) in an NRO account.
Now I started living in India , doing a job and hence filed every years tax return as a resident Indian.
In 2008 , I bought some shares of a Private Limited company (It was a start up so Not listed) . Of course the money was what I brought from outside India but at the time I bought the shares I was resident Indian.
Since early 2011 I have again left India and came out so since early 2011 now I am again NRI.
Now the situation is that I am selling those shares of the private limited company. Since this is over 3 years of investment I think it will attract Long term capital gain. Question is How much?
Different forums are giving different answers. Some are saying that I can choose between 20 % after indexation or 10% without indexation but then other forum is saying that 10% without indexation is not applicable for Private Limited companies.
So does anyone know whether this is true (that 10% without indexation is not applicable for Private Limited companies) if yes does it matter if you are a resident or non resident ?
Then I also read somewhere that NRI can claim 10% without indexation if they have invested in "Specific Assets" which include "Shares of Indian Company". But my confusion is that When I invested I was resident but now I am NRI so what will be my position.
I know I have asked a lot of things and it might confuse you but if you are willing to help and want to get any clarification from me, please shoot....
1) When I had purchased the shares in 2008 I was resident Indian. Now When I am selling I am an NRI so for this transactions Tax , I would be considered Resident Indian or NRI
2) Assuming that I am considered NRI as per the point above, Will the section 112(1)(c)(iii) be applicable only if the person bought the shares using foreign currency or it is also applicable if he/she bought the shares using INR from his Indian accounts?
So as mentioned in the above information, I sold the shares of a private unlisted company. The share purchase agreement was signed in March 2013 but I received the money in April 2013. The buyers have deducted the TDS which is more than what I am supposed to pay to Govt. Now my question is should I file the tax return for this transaction for FY 2012-13 because the Share purchase agreement was signed in March 2013 or I file the return in FY 2013-14 because I received the money in April 2013. Please advise.
09 April 2013
Once you have signed the Share Purchase Agreement, the transaction would be complete.
A key point to note is the Financial Year in which tax has been deduction. If Tax was deducted for FY 2012-13, it would be better to file return for the same year.
CAclubindia
