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Promoter capital gain tax

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Asif Shaikh

80 Points Posted on 04 September 2021

Hi, if anyone could help with the below query: Sale of equity shares held by promoters in an IPO would be eligible for concessional capital gains tax rate of 10% under 112A and period of holding should be 12 months and not 24 months? Would appreciate your views

Replies (2)

Quick Summary

This discussion clarifies the capital gains tax implications for promoters selling equity shares during an IPO. It confirms that the concessional tax rate of 10% under Section 112A applies, provided the shares are listed and held for over 12 months, with Securities Transaction Tax (STT) paid. The key takeaway is that the holding period for this benefit is 12 months, not 24 months.

prasad Nilugal

GST Practitioner & Accounts

15146 Points Posted on 04 September 2021

Section 112 A of the Income tax is applicable to only long term capital gains ( holding period more than 12 months ) from listed equity shares subject to payment of STT .