- CBDT creates new rule for income tax exemption
- Income tax savings on buying shares of companies with INSOLVENCY process
- People will invest in such companies to save tax
- These rules are applicable from 1 April
- New Delhi: Income Tax ( Income Tax ) to save people constantly seek such schemes (Tax Saving Schemes) which invest so you can save tax, the government has now suggested a very simple way. In fact, the Central Board of Direct Taxes (CBDT) has announced Income Tax Exemption to those who buy shares of sinking companies at a price lower than the market price. But the thing to be noted here is that the company whose shares you are going to buy has been taken over by the government under the Insolvency Proceedings.There will be a change in the rules from Mutual Fund to Provident Fund, know how it will affect your budget
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This rule will be applicable from 1 April 2020- CBDT has said in its notification that this rule will come into effect from 1 April 2020 and will be valid for the financial year 2020-21. These exemptions have been granted on the purchase of shares of companies whose board of directors have been suspended by the tribunal on the application of the central government and the new board of directors has been approved by the tribunal on the government’s plan.
These rules will also apply to YES Bank- Let us tell you that yes bank is the perfect example of this rule. Shaker holders of this bank who have bought shares under Yes Bank Re-construction Scheme 2020 also buy shares. But income tax will be exempt.
Tax savings will be benefited – Experts say that the government has come up with such a scheme to encourage investors. Reconstruction schemes would prove to be more profitable for investors due to such discounts. Which means that investors will also invest more money in such schemes.
