Issue of shares for consideration other than cash
This query is : Resolved
Quick Summary
Swati Sharma
(Querist)
03 November 2020
Dear Member,
A company wants to issue shares to its Directors in lieu of services offered by them as they are not drawing any salary.
Now what is the income tax implication??
Will the value of shares be added in their income and taxed in their Yearly income OR there will only be Longterm Gain or Both??
Kindly enlighten
A company wants to issue shares to its Directors in lieu of services offered by them as they are not drawing any salary.
Now what is the income tax implication??
Will the value of shares be added in their income and taxed in their Yearly income OR there will only be Longterm Gain or Both??
Kindly enlighten
CA R SEETHARAMAN
(Expert)
03 November 2020
The value of shares be added in their income as perquisite considering it as sweat equity.
Swati Sharma
(Querist)
03 November 2020
Thanks... also if shares are issued to promoters for providing know-how, then also it will be added to their income??
CA R SEETHARAMAN
(Expert)
03 November 2020
Yes, it's for service ..............
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