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Calculate perquisite tax on vesting, 12.5% foreign LTCG / slab STCG on sale, forex gains, and Schedule FA compliance for US equities.
All foreign shares held in US brokerages must be disclosed in Schedule FA Table A3 to avoid statutory penalties under the Black Money Act.
| Component | Value (USD $) | Value (INR ₹) | Tax Provision / Rule |
|---|---|---|---|
| Perquisite Value (Stage 1) | $15000.00 | ₹12.97 L | Section 17(2) Salary Perquisite |
| Stage 1 Perquisite Tax | — | ₹4.05 L | Taxed at 30% + 4% Cess |
| USD Price Movement Gain | $3400.00 | ₹2.94 L | Pure stock appreciation |
| Forex Depreciation Gain (INR) | — | ₹34,000 | USD/INR rate change: ₹86.5 → ₹89 |
| Net Capital Gain / (Loss) | $3400.00 | ₹3.28 L | LTCG (>24m): 12.5% + Cess |
Two-stage taxation (Perquisite vs Capital Gains), SBI TT Buying Rate conversions, 12.5% LTCG post-Budget, and avoiding ₹10L penalties on Schedule FA.
Perquisite = (Vest FMV - Purchase Price) × USD/INR × Shares
Treated as part of gross salary under Section 17(2). Taxes are withheld at source (TDS) via sell-to-cover.
Capital Gain = (Sale Price × Sale USD/INR) - (Vest FMV × Vest USD/INR)
Unlisted foreign shares: >24 months is LTCG (flat 12.5% + 4% cess under Section 112).
US equities are taxed in two distinct stages in India: 1) At Vesting: The Fair Market Value (FMV) minus purchase price is treated as perquisite salary and taxed at your individual income tax slab rate (typically 31.2% with cess). 2) At Sale: The difference between the sale proceeds and the vest-date FMV is taxed as Capital Gains.
Foreign equities are classified as unlisted shares under the Income Tax Act. If held for more than 24 months, gains are Long-Term Capital Gains (LTCG) taxed at a flat 12.5% (+ 4% cess = 13.0%, without indexation, post Budget 2024). If held for 24 months or less, gains are Short-Term Capital Gains (STCG) taxed at your regular income tax slab rate.
Yes, mandatory. Indian resident taxpayers holding foreign equities, RSUs, or foreign brokerage accounts (Morgan Stanley, Charles Schwab, Fidelity, E*TRADE) must disclose them in Schedule FA and Schedule FSI of ITR-2 or ITR-3 even if annual taxable income is ₹0. Failure to disclose attracts a mandatory penalty of ₹10,00,000 under Section 43 of the Black Money Act.
Under "Sell to Cover", the employer brokerage automatically withholds and sells a portion of your vested shares (typically ~31.2% matching your highest slab) on the vest day to pay your perquisite withholding tax directly to the Indian government, depositing the remaining net shares into your account.
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