Tax implication on sale of shares in ipo

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BRS83 (Querist)
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25 March 2013 HI, My Client holds some shares of an unlisted company based in MUMBAI - now the company is coming out with an IPO - My question is, what will be the tax implication if - My client offers his shares for sale through the IPO and OR My client sells it when it gets listed on Listing day Note: My Client holds shares from 2006 and his wife holds from NOV 2012 Kindly help me with the answers for both with respective tax implication.... Thanks

CA Mahavir Shah

CA Mahavir Shah (Expert)
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26 March 2013 If your Client offers his shares for sale through IPO than he has to pay Long term Capital gain on it and his wife has to pay Short Term Capital gain.

But if they sales it after getting it listed than His gain will be considered as Exempt if he sales through recognized stock exchange paying STT.
And his wife need to pay STCG @ 15% if she sales after being it listed through recognized stock exchange paying STT.

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BRS83

BRS83 (Querist)
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26 March 2013 Hi
Mahavir Shah ,Thanks for your prompt & exact advice.. truly..
Thanks once again
Have a fantastic day ahead.

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