Bonus shares

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Last Comment 2022-11-25

2022-11-25

Please do let me know your thoughts on following

1) How much reserve needed to issue bonus shares for company? Also Please clarify that After Bonus issue, Reserve & Profit will be decreased or not? If yes, Please specify proportion of that?
2) How income tax (LTCG or STCG) will be applicable on selling of the bonus shares?
(Take a classic example of Nykaa)

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https://www.desidime.com/discussions/bonus-shares?page=1#post_8903711

Smiling

2022-11-25

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Bonus share always adjust from the current price same day of bonus share issued. So nothing extra profit here. ( e.g if you have 10 shares of XYZ with price of each share Rs 1000 and XYZ company planning to issue 1 bonus share for each share than the day of bonus issued the market price of each share would be Rs500)

Nothing changes in tax as your total buying amount and total selling amount not changing.

https://www.desidime.com/discussions/bonus-shares?page=1#post_8904588

champu_no1

2022-11-25

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Nykaa was anything but a classic example Anyways, Answer to 2) Cost of aquisition of bonus share is 0. Say if you sell your old share (in case of nykaa say buy price 900 sell price 200) then loss will be 700 and tax LTCL/STCL. But for your bonus shares profit will be 200-0 = 200 and tax 15%on200 STCG