ESOPs in ITR
I have worked in a startup which gave me ESOPs. I left the company and they have passed on to me my share of vested ESOPs in zenequity. Do I need to mention this while filing ITR? Do I need to pay tax on it?
darktruth
Stealth
a year ago
Writing based on what I learnt and did. Would strongly recommend talking to CA.
- Till you exercise, nothing to be done in ITR
- At the time of exercise, pay tax based on notional profit. (FMV - exercise price). It is unfair but this is what the law states. Also note that fmv can be different from valuation at the time of fundraising.
- if the company is registered outside of India, you now own foreign asset. You will have to declare it in ITR. You will also have to fill out 15 CA / Cb while remitting money abroad while exercising
NeatFrame72
Stealth
a year ago
Thanks a lot. How do I avail service from a CA?
darktruth
Stealth
a year ago
Check any local CA or ask a colleague. Better to have someone via reference
No.
As long as you haven’t exercised any ESOPs there is nothing for you to report.
You only pay taxes and report when: you exercise (perquisite tax) and when you sell (capital gains).
Or if the company does a direct buy back then most likely you just end up paying perquisite then. You have nothing to worry about.
PS: I have spent years in this space.
