What is cost of acquisition of bonus shares?

The cost of acquisition of bonus shares is taken as zero hence the capital gain on selling a bonus share issue is equal to its selling price.

What is cost of acquisition of shares?

Cost of Acquisition –

The lesser value between the fair market value and the actual sale value of the investment is chosen. It is then compared with purchase value of the share, and the higher value between the two is chosen.

What is the cost of acquisition in case of bonus shares allotted after 1.4 2001?

The cost of acquisition of bonus shares is nil.

The cost of acquisition of trading or clearing rights acquired under such scheme of demutualisation or corporatisation is nil. 14.

How is Ltcg calculated on bonus shares?

The CoA will be calculated in the same way as it was done for bonus shares. First we have to take lower of the FMV (Rs 150) and sale price (Rs 200) which is Rs 150. Then between A (Rs 150) and buying price (Rs 120) we have to take higher price, which is Rs 150. Here LTCG will be Rs 50 (Rs 200 minus Rs 150).

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What is the date of acquisition for bonus shares?

In case of the 200 bonus shares which were allotted on 9-11-2019, the date of allotment of such shares would be considered as the date of acquisition. Therefore the period of holding in the above mentioned case for bonus shares would be short term and therefore tax on these gains of Rs.

What is acquisition cost example?

Acquisition cost refers to the all-in cost to purchase an asset. These costs include shipping, sales taxes, and customs fees, as well as the costs of site preparation, installation, and testing. … These costs include marketing materials, commissions, discounts offered, and salesperson visits.

What is included in acquisition cost?

In accounting, the cost of acquisition is a line item that includes all expenses related to buying and deploying an asset except for any sales taxes. In sales and marketing, the cost of acquisition includes all the costs of acquiring new customers.

Can I sell bonus shares immediately?

You need to note here that the bonus shares first get credited under a temporary ISIN and will not be admitted to trading immediately. … Once the bonus shares are credited to your DEMAT, your P&L will be restored to its correct value.

Which company will give bonus share in 2021?

Bonus

COMPANY Bonus Ratio DATE
APL Apollo 1:1 16-09-2021
Kanpur Plast 1:2 15-09-2021
Mahindra Life 2:1 14-09-2021
Mahindra Holida 1:2 08-09-2021

Can we sell bonus shares?

Shareholders may sell the bonus shares and meet their liquidity needs. Bonus shares may also be issued to restructure company reserves. Issuing bonus shares does not involve cash flow.

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Are bonus shares free of cost?

Bonus shares are free shares are given to the existing shareholders of a company without any extra cost. … This means that the company will issue one bonus share for every one share held by the existing shareholders and one bonus share for every two shares held by the existing shareholders, respectively.

What is Ltcg exemption?

Residential Indians between 60 to 80 years of age will be exempted from long-term capital gains tax in 2021 if they earn Rs. 3,00,000 per annum. For individuals of 60 years or younger, the exempted limit is Rs. 2,50,000 every year.

How can I save Ltcg on shares?

Holding your shares long term i.e. for greater than a year so as to not end up paying Short Term Capital Gains Tax at the rate of 15% Keeping your LTCG less than Rs 1 lakh or marginally above Rs 1 lakh to ensure a minimal tax outgo.

What is the benefit of bonus shares?

Bonus shares give positive sign to the market that the company is committed towards long term growth story. Bonus shares increase the outstanding shares which in turn enhances the liquidity of the stock. The perception of the company’s size increases with the increase in the issued share capital.

Is bonus stripping legal?

As a check on the activity of bonus stripping, provisions under Section 94(8) of the Income-tax Act, 1961 were introduced into the statute books. According to this section, if a person: acquires units within 3 months prior to the record date. … and the original units are sold within 9 months from the record date.

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What is the difference between DRP and BSP?

Eligible shareholders can participate in QBE’s Dividend Reinvestment Plan (DRP) and Bonus Share Plan (BSP) when the plans are active. The DRP enables shareholders to subscribe for additional shares. The BSP is a bonus share plan whereby the dividend entitlement is foregone for bonus shares in lieu of the dividend.