Hello Sir...Pl. advise my HDFC LTD; Shares of (FV.Rs.2.00) held before 31Jan2018 and since Merged into HDFC BANK LTD; will be Costed at what Price, if sold now as HDFC Bank Shares for purpose of Calculating LTCG FY.2023-24...Thanks.

Ans: HDFC shareholder has got 42 shares of HDFC Bank for every 25 shares they hold.

Ans: already answered

Ans: I understand that navigating tax implications can be tricky. Since you acquired HDFC Bank shares on a rights basis in 1995 and have experienced stock splits in 2011 and 2019, the merger with HDFC Ltd adds another layer of complexity.

To determine the tax you'll need to pay upon selling your shares, you'll need to consider the following:

Cost Basis: Calculate the original cost basis of your shares, including any additional shares received from the stock splits.

Current Market Value: Determine the current market value of your shares at the time of sale.

Capital Gains: Subtract the cost basis from the current market value to find the capital gains.

Holding Period: Since you've held the shares for over 20 years, they qualify as long-term investments, which typically have a lower tax rate compared to short-term investments.

Tax Rate: The long-term capital gains tax rate for equities in India is 10% if the gain exceeds ?1 lakh in a financial year.

Ans: Dear Sir,
The cost of acquisition of shares purchased before 31 Jan 2018 and sold there after shall be as follows

COA of such investments shall be deemed to be the higher of:

The actual COA of such investments; and
The lower of-
Fair Market Value (‘FMV’) of such investments as on 31 Jan 2018; and
the Full Value of Consideration received or accruing as a result of the transfer of the capital asset i.e. the Sale Price
Further, the FMV would be the highest price quoted on the recognised stock exchange on 31 January 2018.

Though there has been split up of shares, that does not change the COA since the COA will be distributed over all the shares of respective company and Total amount of COA shall be arrived as per the method given above.