Ask Me Something about Taxation on Buying and selling & Investing #TaxSeason2020

Ask Me Anything about Taxation on Trading & Investing #TaxSeason2020


I had a query relating to ESOP perquisite achieve and taxation.

The corporate is deducting perquisite achieve tax after I train my inventory choices (which is appropriate)
However when will I get the perquisite achieve quantity? They’re saying solely whenever you promote your shares will get the achieve after IPO.

Instance: Inventory train value 2$
FMV after I exercised the choice = 10$
Share value when bought after IPO = 15$
No of shares = 100

  1. Why can’t the corporate pay the perquisite achieve (10$-2$X100) in my wage if they’re deducting tax on it? Why do I want to attend until it’s bought within the IPO?

  2. I’m paying the tax on this monetary yr, IPO will occur say subsequent FY yr and I’ll get the achieve quantity subsequent yr whereas its tax was paid on this FY. How will the earnings tax division know that I’ve already paid some tax final FY yr (10$-2$X100)? I do know I must pay the capital achieve on the achieve that I’ll get (15$-10$X100) however how will the earnings tax depart know that I have already got paid tax within the final FY yr?

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