[Section 46A] Capital Gain on Buyback of shares (Amendment for June 2021)

Buy back of securities, other than shares is a transfer for its holders

Sale Consideration : Amount received by a shareholder from the company.

Taxable : In the year, when such securities are purchased by the company.

Taxpoint :

In case of buy back of shares, any income or capital gain is exempt under section 10(34A) in the hands of shareholders.

Company itself liable to pay additional tax @20% (+surcharge + Cess) under section 115QA.