I need a suggestion on tax saving options for my long term RSUs, I am working for MNC based out of USA and consider that i have been granted RSUs worth 10lacs in 2014 (US stock exchange) and after complete vesting i hold RSUs worth 7lac as per 2014 price (30% tax deducted at the time of vesting in US itself), now consider that stocks price has almost doubled and now current value of total RSUs are 14lacs (net profit of 7lacs after deducting 30% tax in US). So as i understand this is considered as long term capital gain and i need to pay 20% tax for it, i.e. 1.4lacs (20% of 7lacs).
So my question is does it considered as long term capital gain for tax benefits? I am planning to construct a house in near future, so can i show capital gain for house construction and avail full tax benefit for 1.4lacs? My tax slab is 30%.
Asked 7 months ago in Capital Gains Tax
"To claim full exemption the entire sale receipts have to be invested."
In that case i can sell in parts right, i will sell what is required for purchase of property and rest i will sell in another bunch.
"Please note that for under-construction properties.........."
Does it apply for purchasing a resale (old) of a flat or house? It does not necessary a new house right?
"There is no set-off available with construction of house"
I did not understand this, basically i am planning to use the money from RSUs to buy a flat or construct a house (not yet decided on property type as i need to be clear on 54F) so that i can save that 20% money which otherwise i have to pay as tax for long term capital gain.
Asked 7 months ago
Thank you all for the answers, it is very helpful.
Does definition of Long-term vs Short term capital gain varies between USA and India? Because I see that in my etrade account RSUs that are granted in 2017/Aug and vested on 2018/Aug shows as Long term, Does it considered as long term capital gain?
Can you please elaborate on what is the criteria for capital gain to be considered as long term in terms of grant date or vest date?
Further i see answer saying "i must be holding not more than one house... ", i already own a plot but not possible to construct in immediate future as its outside the city, so its still applicable when i go for second property right?
Asked 7 months ago
Does the 54f applies to unlisted shares also? Company that i am talking about is listed in US where i hold shares and its not listed in Indian stock exchange.
Further for construction of house to get LTCG is there any restriction? Like if i construct a multi dwelling house with more than one kitchen is it still applicable to tax exemption?
Asked 6 months ago
Thanks all for your valuable feedback. I have decided to sell the stocks now, as i understand i need to move complete amount to a capital gain account to avail the benefits (as i have 2 years from now, need to decide later on property). However I dont have a capital account right now and given current lock down situation I wont be able to create one in coming weeks, so is it fine if i keep amount in savings account till capital gain account is created?
Is there any rules for capital gain account on when money need to be transferred? Assuming that i will sell the stocks today. Or Do i have to route money directly to capital gain account?
Thanks in advance,
Asked 4 months ago
Please note that i have sold stocks 2 days back, i.e financial year 2020-2021. So which means i need to transfer the money to capital gains account before filing the return next year, which is before July 31 2021 right?
Until then can I keep money in current bank account to create FD? Further I believe interest on that is taxable according to my tax slab?
Further a question related to one that i asked above, if i book a flat considering the today's sell date, date of possession need to be within next 3 years to get the tax benefit under 54f right?
Asked 4 months ago