RSU – calculating short term capital gains

POSTED BY Sarangarajan Tirucherai ON July 30, 2013 4:31 pm COMMENTS (2)

Following is my question

RSU received (after adjusting for tax) on 10-Dec-2013 and 10-Mar-2013 are 20 & 20. If on 10-Dec-2013 share prices was 30USD and on 10-Mar-2013 it was 32 and if I sell at 35 today — can we use Cost of Index to arrive at todays purchase price and then calculate the short term tax
Purchase price for 10-Dec-2013 shares = 20 Shares * 30 USD * 939/852 (cost of index) = 661 USD
Purchase price for 10-Mar-2013 shares = 20 Shares * 32 USD * 939/852 (cost of index) = 705 USD

Total Sale value = 40 * 35 = 1400 USD
So net Gain/loss = 1400 – 661 -705 = 34 USD (assuming no cost for transfer)

So do I pay 30.09% of 34 USD * today’s USD to INR currency conversion

Please clarify whether the above method is correct.

Thanks and Regards
Sarang

2 replies on this article “RSU – calculating short term capital gains”

  1. Sarangarajan Tirucherai says:

    Dear Manish,

    Probably i did not ask the question correctly. I had said that RSU received is post tax — meaning if they provide me 28.5 RSU, they sell 8.5 on the day of vesting and provide me with only 20 Shares.

    So on
    10-Dec-2013 — 28.5 RSU Vested, 8.5 sold and 20 shares provided to me — so i have already paid the necessary tax on 10-Dec-2012

    Same way I would have paid tax for final shares provided to me (20) on 10-Mar-2013

    Anycase it was clarified that for short term we cannot use Cost of Index

  2. As far as I understand, you never pay for RSU , you get it for FREE . So your cost price is ZERO personally. so what ever income you generate is all PROFIT and you need to pay tax on it .

    Now if its listed in India, then LTCG comes into picture, else you need to pay it as if its not listed in India

Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Download Our FREE Ebook!

Available only for first 100 people today

Download Our FREE Ebook!

Available only for first 100 people today