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Mihir Tanna825 Answers |Ask - Follow
Tax Expert - Answered on Nov 17, 2022
Asked on - Nov 17, 2022Hindi
I've seen your answers to tax queries raised by readers of rediff.com and find your answers quite useful. I too have a question in this regard, which I've asked below.
I was an NRI working abroad at a startup in the UK during which time I vested stock options as part of my compensation. I returned to India about 2 years ago and now my tax status is an Indian resident.
The startup has gone public in the UK stock market now, and I would like to know if I have to file/pay advance tax when I either exercise & sell and/or only exercise these stock options, OR, can I just file my return as usual in the next financial year before the 31-Jul deadline as usual?
Ans: Income earned by resident (anywhere in the world) is taxable is India. Accordingly, when you exercise option, you have to pay tax on fair market value of shares reduced by amount paid by you and you have to make disclosure in ITR. Again at the time of transfer of ESOP, taxability will arise on consideration received on transfer reduced by the fair market value at the time of exercise of option.
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