Taxability on ESOP issued by a Unlisted Co.

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Querist : Anonymous

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Querist : Anonymous (Querist)
12 May 2011 Kindly explain the provisions of taxabilty in the Hand of Employee on ESOP issued by an unlisted Company? How the perquisites will be deceided at the time of excecise of option by an employee and how the long term and short term gain will be computed in such cases?

12 May 2011 For unlisted companies the FMV is decided by a merchant bankers on the specified date.
Specified date may be
date of exercise of the option
or a date not more than 180 days before.

Capital Gains shall be computed by taking the perquisite value in that respect + any amount paid by the employee as cost of acquisition.
For Long Term -More than 12months holding period is required.
Indexation will be allowed in case of LTCG.

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Querist : Anonymous

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Querist : Anonymous (Querist)
13 May 2011 Thanks a lot


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