Share capital - premium
This query is : Resolved
suresh subramanian
(Querist)
21 August 2012
Dear Sir
We are a MNC company. Recently we have receive share capital, as per the DCF method the share value is calculated.
But it is over and above the issue value.
The premium has to be shown in the P & L and pay tax for it ?
Kindly advice.
Suresh Subramanian
9791905733
We are a MNC company. Recently we have receive share capital, as per the DCF method the share value is calculated.
But it is over and above the issue value.
The premium has to be shown in the P & L and pay tax for it ?
Kindly advice.
Suresh Subramanian
9791905733
Arun Biyani
(Expert)
22 August 2012
yes, where a company, not a company in which the public are substantially interested, receives, in any previous year, from any person being a resident, any consideration for issue of shares. In such a case if the consideration received for issue of shares 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. however your being a MNC company if has received the consideration from venture capital undertaking or from a venture capital company or a venture capital fund the provision are not applicable.
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