Sale of residential property by a listed company 2 director
This query is : Resolved
Querist : Anonymous
Querist :
Anonymous
(Querist)
03 August 2011
Please help me for the following case:-
A listed company is owning a residential property worth in crores. The board of directors has decided to transfer this property to one of its director based on his immense contribution to the company. Now there are two options with the company.
1) To make the director as a tenant of the property & then sell the property after 5 years to director.
2) To give the director an option like in ESOP and the director can exercise the option till a period of 5 years.
Now the question is what would be the best tax implications both for the company & the director to reduce tax liability. Also are there any reporting requirements to be made to SEBI relating to corporate governance. If the director purchases the property whether it will be treated as loan to director.
A listed company is owning a residential property worth in crores. The board of directors has decided to transfer this property to one of its director based on his immense contribution to the company. Now there are two options with the company.
1) To make the director as a tenant of the property & then sell the property after 5 years to director.
2) To give the director an option like in ESOP and the director can exercise the option till a period of 5 years.
Now the question is what would be the best tax implications both for the company & the director to reduce tax liability. Also are there any reporting requirements to be made to SEBI relating to corporate governance. If the director purchases the property whether it will be treated as loan to director.
04 August 2011
In all cases while transferring the assets of the company registration is required to be done and as per Section 50C Capital Gains has to be paid and the director should have this much money to pay to the company.
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