Tax implication Buy back offer.

    Since no STT is paid the profit on buy-back shares are taxable whatever is the perid of your holding.Comments please.

    0  Views: 1766 Answers: 1 Posted: 13 years ago

    1 Answer

    If that is a question, then yes, the profit on the buy-back shares is taxable.

    There is no exemption on STT paid speculative income. That's only for Long term capital gains.

    For long term:
    You have to determine your period of holding for the securities. If you held them for more than 12 months then its exempt u/s 10(38), otherwise its taxable @ 10% as STCG.

    If its an income from speculation, that is intra day trading, then its a business income and you would need to calculate your total profit and loss on it and that would be taxed at normal tax rates, and you can claim rebate of STT paid on it. You can't deduct the STT from the profit. So profit has to be computed by adding back STT on all the purchase sale transactions.

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