angel tax startups

The I-T department's draft rules on valuation of funding in unlisted startups for calculating 'angel tax' will bridge the gap between the rules outlined in FEMA and the Income Tax, but the 10 per cent safe harbour which is proposed for equity investment should be extended to convertible preference shares, experts said. The Central Board of Direct Taxes (CBDT) on May 26 issued draft rules providing more flexibility for valuation of equity investments made in unlisted startups. For non-resident investors the valuation…

SC Panel: Can’t Say There was Failure on Sebi’s PartHindenburg Allegations Against Adani Group - The six-member expert panel set up by the Supreme Court said it would not be possible to conclude that there was a regulatory failure on Securities and Exchange Board of India’s part in its handling of certain allegations of violations against Adani Group companies.Changes Proposed to Angel Tax Rules India on Friday proposed to exclude a host of foreign investors including sovereign wealth funds and pensions funds from the…

Venture capital (VC) investors welcomed the changes proposed by the government to angel tax provisions that were originally announced in the Union budget for 2023-24, saying they provide much-needed clarity on incidence of the tax while preventing it from being arbitrarily applied.“The proposed norms aim to expand valuation methodologies and eliminate price differentials between resident and non-resident investors… This inclusive approach will facilitate ongoing investments in the country,” said Karthik Reddy,…

India may accept the valuation criterion followed under the foreign exchange management law for the so-called angel tax on investments by overseas investors in startups, to provide clarity and end tax disputes.The Reserve Bank of India (RBI) administered Foreign Exchange Management Act (FEMA) accepts valuation by a Sebi-registered Category 1 merchant banker using any internationally accepted pricing methodology applied on an arm’s length basis.Tax authorities are considering adopting the same, among other options, for…