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Apr 01, 2026
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Capital gains on share buyback get new surcharge twist; income tax dept explains what it means for you
On March 26, 2026, the Income Tax Department clarified that one of the changes made through the government's amendments to the Finance Bill, 2026 introduces a surcharge on the additional income-tax that promoters have to pay on capital gains arising from buyback, in accordance with Section 68 of the Companies Act, 2013. The surcharge is set at 12%.
The Income Tax Department said on X (formerly Twitter): "It is clarified that Section 69 of the Income-tax Act, 2025 provides for tax rates only in respect of additional income tax on promoters in respect of capital gains on such buyback. Therefore, the rate of 12% will apply only on additional income-tax to be paid by the promoters on aforesaid capital gains mentioned in Section 69(2) (b)."
What does this mean for individuals who are not promoters of a listed company?
This means that for individuals who are non-promoters, surcharge as per normal provisions will apply, if applicable on such capital gains.
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