I am holding some shares of a private company. This company is now bought by one listed company and I will be given shares of the listed company in place of shares I am holding. Will I need to pay any tax now? From which date holding period is calculate and How will my tax be calculated if I decide to sell the shares of the listed company which I will get.
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capital gain tax
Replies (2)
No you dont need to pay any tax now . But same will be payable as soon as u will sale these stocks & in that case period of holding will include period for which u hold these shares originally.
according to sec 47(1) any shares issued by amalgamated company to the share holders of amalgamating company instead of shareholding to the share holders it is not regarded as transfer.
period of holding will be calculated from the shares held in amalgamating company to the year of sale.
when the shares of amalgamated company sold by holder it is treated as transfer and taxable accord to the period of holding if u have 100*10 shares in amalgamating the its value 1000, if amalgamated company gave 100 shares cost of each share is value of amalgamating company it means 1000/100=10 rs per share cost of acquisition is Rs. 10 sale consideration is on price you had sold.
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