Tax on Unlisted Shares

I sold a certain number of shares of an unlisted company in September 2016. These shares were purchased by me in March 2014. What is the tax implications if there is a gain arising on proposed transfer of the said shares?
—Answer :::

As per the third proviso to Section 2(42A) newly inserted by Finance Act 2016, the shares of unlisted company shall be considered as short-term capital asset if they are held by the assessee for a period of not more than 24 months before the date of its transfer. Therefore in the instant case, since the shares of the unlisted company are held for a period of more than 24 months, the gain on sale of such shares shall be taxable as long term capital gains at the rate of 20% (with cost indexation benefit).

Sandip Ginodia , Director

ALTIUS INVESTECH PVT LTD | ABHISHEK SECURITIES

We deal in over 60 unlisted companies with 15 years of experience .

For latest prices visit : www.abhisheksecurities.com/unlisted.htm / call : 09830271248 .

Email : ginodiasandip1@gmail.com

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