buy back shares sale considerations and cost of acquisition in capital gain schedule

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This discussion clarifies how to report buy back shares for capital gains tax purposes. It addresses whether the full sale consideration and acquisition cost need to be included in the capital gains schedule. The consensus is that only the profit should be reported in the Exempt Income (EI) schedule, not the sale consideration or acquisition cost, as the transaction is not taxable. While this might seem like a mismatch with AIS and broker statements, it should not cause assessment issues as the income is exempt.

Vivek Desai

Vivek Desai (Querist)

30 June 2024 Whether Buy back shares full value consideration and cost of acquisition is required to include in capital gain schedule? If yes then how tax exemption shown in EI schedule will get reduced from total gain offered for taxation in capital gain schedule.
OR only profit is to be reported in EI schedule & No sale consideration , cost of acquisition is to report.

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)

30 June 2024 No to report it in Schedule CG. Report only gain in Schedule EI.

Vivek Desai

Vivek Desai (Querist)

01 July 2024 Buy Back shares not reporting in CG schedule will mismatch create with AIS and Broker’s PnL statement. Profit can be shown in EI schedule However, providing feedback ‘Income is not taxable’ in AIS against buy back shares transactions, total sales consideration figures found not changing. Will there be any problem while Assessments.

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)

01 July 2024 No problem would arise, as the transaction is not taxable.

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