{"id":38384,"date":"2024-01-16T19:43:42","date_gmt":"2024-01-16T14:13:42","guid":{"rendered":"https:\/\/itatonline.org\/digest\/?post_type=qa&#038;p=38384"},"modified":"2024-01-16T19:43:42","modified_gmt":"2024-01-16T14:13:42","slug":"capital-gains-sale-of-equity-shares","status":"publish","type":"qa","link":"https:\/\/itatonline.org\/digest\/qa\/capital-gains-sale-of-equity-shares\/","title":{"rendered":"Capital gains, sale of equity shares ?"},"content":{"rendered":"<p>The founders of a Start-up company sold 51% of their equity stake in a company to a strategic buyer in FY 2023-24. The total consideration for transfer of shares was agreed at Rs. 25 crores<\/p>\n<p>As per the terms of the deal, the founders are required to stay with the company for next 5 years after which their balance stake would be purchased. The founders are eligible for an additional consideration of Rs 5 crores at the end of the third year provided the revenue projections as per business plan are met.<\/p>\n<ul>\n<li>While filing the tax return for 2024-25, and computing capital gains, what should be the total value of consideration \u2013 should it be Rs. 25 crores or Rs. 30 crores?<\/li>\n<li>If Rs. 5 crores is not to be taxed in year 1, should it be taxed in the year of 2027\/28 of actual receipt or should the original return be revised after the earn out is received?<\/li>\n<li>Can any exemption be claimed against earn out of Rs. 5 crore, 3 years investment time limit from the original share transfer date would be Over?<\/li>\n<\/ul>\n","protected":false},"comment_status":"open","ping_status":"closed","template":"","qa_expert":[1130,1129],"qa_category":[23],"qa_tag":[24,199],"class_list":["post-38384","qa","type-qa","status-publish","hentry","qa_expert-chartered-accountant","qa_expert-mr-h-n-motiwalla","qa_category-income-tax","qa_tag-capital-gains","qa_tag-sale-of-equity-shares"],"acf":[],"jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/qa\/38384","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/qa"}],"about":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/types\/qa"}],"replies":[{"embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/comments?post=38384"}],"wp:attachment":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/media?parent=38384"}],"wp:term":[{"taxonomy":"qa_expert","embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/qa_expert?post=38384"},{"taxonomy":"qa_category","embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/qa_category?post=38384"},{"taxonomy":"qa_tag","embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/qa_tag?post=38384"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}