Minor to major - shares case

Save Share

This query is : Resolved

Prashant (Querist)

16 January 2011 Hi, I'm a salaried guy but do little bit share trading, i'm having a query its that

When I was minor, some shares were purchased in my name....now I'm major(more than 10 yrs)...so how these shares will be treated? (gift / loan / some other)whats the tax issue in this case...also when i sell them where will this be shown?

As well as how can I re-transfer it to my guardian who purchased it in my name?

CA PARAS BAFNA

CA PARAS BAFNA (Expert)

17 January 2011 First you have to decide the ownership and amount invested.
*
As your guardians have invested the amount in your name, you may treat it as Gift received from them, provided that they had not taken it otherwise, in their returns.

*
As these shares are long term capital asset and on sale entire capital gains will be exempt.
*
If you re-transfer them to your guardian
then it will be treated as gift, in these circumstances.

Guest

Guest (Expert)

17 January 2011 i agree with Mr. Bafna but these shares should be listed shares.

Prashant

Prashant (Querist)

19 January 2011 Thanks a lot Mr. Bafna for replying to my query...It did resolved my question.

But I did not understood your line "First you have to decide the ownership and amount invested" !!

for this I don't have the old records as this transaction is more than 15 years ago. so what should I do? how should I treat this - gift / something else?

(also, just for knowledge...what will be my Tax liab. if I return these shares under gift to my guardian?) pls note, these are listed shares on a Stock exchange.

CA PARAS BAFNA

CA PARAS BAFNA (Expert)

20 January 2011 Amount invested will be required for the purpose of computing the actual amount of LTCG on shares. As LTCG on shares on sales of which STT has been paid , is now exempt
yet cost of shares purchased by you has to be shown.

By Ownership, I meant that , whether your guardian is including these shares in his investments or not .

Guest

Guest (Expert)

20 January 2011 No tax will be liable , if you gift these shares to your guardian

You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now