Hello Sir, I received RSUs (Restricted Stock Units) from a US-based multinational as part of my performance award. At the time of grant, tax was deducted by reducing the number of shares (6 out of 30 were withheld for tax), and the remaining were credited to my account with a 3-year vesting period (8 shares vesting each year). However, I noticed that the full value of the vested shares is also reflected in my Form 16 as income, which has moved me into a higher tax bracket. Could you please confirm if this amounts to double taxation or if this is the correct process?

Ans: Form : ITR 2
Income head : Capital gains
Tax liability depends upon your other income sources. If only this is the amount of income then no tax liability.

Please consult with your CA as well on this.

Ans: Issuance of bonus share does not invoke any tax liability. It is treated as shares acquired on date of allotment at zero price. Whenever you sell these bonus shares the LT/ST CG liability will come into play based on your holding period. Regarding Jio Finance demerger from RIL, it was a part of RIL business which they have now separated therefore for eg. if your buy price of RIL share is Rs.100 per share then you need to apportion this cost between the two after demerger, in the ratio as communicated by RIL to regulators, and record that as your cost of these shares on the date you purchased original RIL shares. Let's say it is 95 & 5 so your acquisition cost of RIL share shud be shown as 95 and cost of acquiring Jio Finance share as 5. Sounds like lot of calculations but if you deal in shares you must have a habit of physical/digital record keeping. Also LT/ST count for Jio Finance shares will be from the same date as you bought original RIL shares and not the date of demerger. Hope this helps.

Ans: Let's address your queries one by one:
1. After payment of Estate Duty in the USA, when the brokerage is allowed to release the shares, where will the shares of C have to be kept?
o Once the Estate Duty is paid, the brokerage can release the shares. Since C is a minor, his 50% share should be kept in a custodial account until he reaches the age of majority. The shares cannot be sold and the money parked in a bank account in India without following proper legal procedures and tax regulations.
2. When a part of the shares are sold by the brokerage for payment of Estate Duty, will the sale price attract capital gains tax?
o Yes, the sale price will attract capital gains tax. The capital gains tax will be calculated based on the difference between the sale price and the fair market value of the shares at the date of death.
3. What will be the cost of acquisition for B & C? Will it be the price at which the shares were originally acquired or the price on the date of death of the holder (this is the rate which has been considered for calculation of the Estate Duty)?
o The cost of acquisition for B and C will be the fair market value of the shares on the date of death of the holder. This value is used for calculating the Estate Duty.
I hope this helps clarify things. If you have any more questions or need further assistance, feel free to ask.