Income Tax: Tax on distributed income of domestic company for ...

Buy-back of shares treated as dividend, capital loss allowed for shareholders. Nil consideration for capital loss. Effective Oct 2024.

Notes Bill

July 30, 2024

Income Tax: Tax on distributed income of domestic company for buy-back of shares to be treated as dividend in hands of shareholders. Cost of acquisition of shares bought back to generate capital loss for shareholders, allowing set-off against subsequent capital gains. Deeming value of consideration for bought back shares as nil for computing capital loss. Amendments effective from October 1, 2024 for any buy-back on or after that date. Aims to widen tax base and prevent avoidance by aligning treatment of dividends and buybacks.

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Income Tax: Tax on distributed income of domestic company for ...

Buy-back of shares treated as dividend, capital loss allowed for shareholders. Nil consideration for capital loss. Effective Oct 2024.

Notes Bill

July 30, 2024

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