Tax libility under approved ESOP scheme

Dear Arun,

Yes u r rite that with the abolition of FBT, the difference in the following two prices will be considered as perks and added in ur salary -

1) FMV of the share on the date of "Exercising the option to buy shares"

2) Price paid to employer as a cost of shares

Dear Amir Thax for reply.......

But i like to ask further that at the time of accepting offer my company not asking for any payment from my side, but I need to hold for 1 yr before transfering them. So in this case what is the amount taxable under salary  AY 2010-11,if company alloted me 100 shares  ( @ 300/-) on discount Rs.150/- i can sell only 20% in each yrs.

Dear Arun,

Since Co. is giving u discount of Rs. 150/share so this amount necomes ur benefit/perquisite & will be taxable as salary i:e Rs. 15,000/-

Now when u will sell these shares the cost that is to be taken for computing gains will be Rs. 300 & not Rs. 150/- since the amount of discount has already been taxed as perquisite in the form of salary..

I fully agree with Amir

please follow this link...

https://www.caclubindia.com/forum/make-esops-more-employee-friendly-69942.asp