A client wants to sell shares of a private limited company. Please say how to calculate the FMV and what will be the tax implication arising from the sale of shares.
Thanks in advance
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Fair market value of unlisted shares
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The shares of a private company, if held for more than 12 months should qualify as long term capital asset . However the benefit of zero taxation which is available to listed shares on which STT is payable, would not be available to shares of a private company. So it will attract LTCG 20%.
And to my knowledge FMV of these shares should be taken as sale price Less actual cost paid to acquire shares.
Please correct me if am wrong.
Thanks
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