Income taxable under section 56(2)(7b) on issue of shares , this option is not enable in winman

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For the assessment year 2025-26, the provisions of Section 56(2)(7b) of the Income-tax Act, which deals with taxing shares issued above their fair market value, have been sunset. This means companies are no longer required to report or pay tax on such share premiums for AY 2025-26 onwards. Consequently, the Winman software does not offer the option to enable this section for ITR-6 filings for AY 2025-26, as it is no longer applicable.

AUDITORS EDAPPAL

AUDITORS EDAPPAL (Querist)
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26 September 2025 income taxable under section 56(2)(7b) on issue of shares, this option is not enable in winman software for the assessment year 2025-26 ITR6 in company. How to enable this option in Winman?

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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26 September 2025 Extract of Clause 23 of Finance Bill 2024 Clause 23 of the Bill seeks to amend section 56 of the Income-tax Act relating to income from other sources. The provisions of clause (viib) of sub-section (2) of the said section provides that where a company, not being a company in which the public are substantially interested, receives, in any previous year, from any person, any consideration for issue of shares that exceeds the face value of such shares, the aggregate consideration received for such shares as exceeds the fair market value of the shares shall be chargeable to income-tax under the head “Income from other sources”. It is also provides that this clause shall not apply where the consideration for issue of shares is received (i) by a venture capital undertaking from a venture capital company or a venture capital fund or a specified fund; or (ii) by a company from a class or classes of persons as may be notified by the Central Government in this behalf. It is proposed to amend the said clause so as to provide that the provisions of the said clause shall not apply on or after 1st April, 2025. This amendment will take effect from 1st April, 2025.

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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26 September 2025 For the assessment year 2025-26, the provisions of section 56(2)(7b) (specifically clause (viib) regarding tax on shares issued above fair market value) have been sunset by the Finance Bill 2024 and are no longer applicable from AY 2025-26 onwards. This means companies do not have to report or pay tax under section 56(2)(7b) for shares issued at a premium for AY 2025-26.

The Winman software does not enable the reporting option for section 56(2)(7b) for ITR-6 for companies for AY 2025-26 because, per law, the section is not applicable and there is no requirement to disclose such income anymore.

This change is intended to simplify return filing and ease compliance for companies, as tax on share premium under this section is not chargeable in this assessment year.

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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26 September 2025 Good luck...

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