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Re: Taxation of Esop

Devendra Sharma (Associate) (38 Points)

02 November 2007

The objective of central govt. guidelines issued in the year 2001 was to exempt the esop from being charged as perquisites in the hands of employee. As the provisions by fincance act 2007 which says that esop not to be charged as perquisites in the hands of employee and employer to pay FBT on esop. Does it mean that now it is not mandatory to comply with the guidelines..?

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3 Replies

(Guest)

I think now we dont need to comply with all those guidelines as now it is taxable as FBT in the hand of Employer so its overwrite the main objectives of introducing those guidelines in 2001.

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(Guest)

sir , JSPL HAVE GIVEN ESOP 300SHARE 150 SHARE VESTED ON 26 NOV 07 NOW COMPANY DMOND TO ALL EMPLOYEE FBT +SHARED ALLOT VALUE BEFORE 26 NOV ,WHAT I SHOULD DEPOSIT FBT MONEY BY EMPLOEE.

Devendra Sharma (Associate) (38 Points)
Replied 05 November 2007

Thanks the reply Mr.Shyam. There is one more issue. Cbdt has recently issued a notification for valuing esos for fbt purpose and says that the notification to come into effect wef 1.04.08, does it mean that in respect of the options vesting during the FY 2007-08 no fbt needs to be paid. Pl clarify