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Financial Planner - Answered on Dec 17, 2020

Anil Rego is the founder of Right Horizons, a financial and wealth management firm. He has 20 years of experience in the field of personal finance.
He’s an expert in income tax and wealth management.
He has completed his CFA/MBA from the ICFAI Business School.... more
Yogen Question by Yogen on Dec 17, 2020Hindi
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I wish to know tax implication of capital gain for shares tendered under buyback and accepted. Whether capital gain, short term or long term is exempt from capital gain tax? If it is under what section? This is because the company which declared buy-back is required to pay 22.4% tax on total buyback amount.

Ans: The shareholder is not liable to pay tax on capital gains of shares tendered in a buy-back offer both for long-term and short-term capital gains. However, they cannot set-off any capital losses as the capital gains are tax-exempt.

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