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Capital gain

07 January 2013

Hi All Kindly let me the tax liability in follwoing case:

A NRI is holding shares in Indian (Private) Company for more than 12 months. Now he wants to trasnfer 50% of his holding to his NRI wife. Teh same could be for consideration or by way of gift.

My query is whether the NRI required to pay any tax in India if he gets any capital gain from the above.

Thanks

Sid

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2 Replies

Back in the Game (a) (1273 Points)
Replied 07 January 2013

Yes it is Transfer and Husband NRI will be liable to capital Gain tax.

However any income generated or Realised from further Sale by the wife,will be clubbed in the hands of husband under Clubbing Provisions.

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Siddharth Singh (CS) (134 Points)
Replied 08 January 2013

Thanks

Would also appreciate if you could let me know the relevant provision under Income Tax Act.

Also will NRI husband be liable to file income tax return in India through its PoA or himself and also if the country in which they currently reside has DTAA with India then what would be the tax liability.

Thanks.