NRI moved to Dubai and exercised Indian bank ESOPs worth Rs 1.56 crore: Know why ITAT ruled they are taxable in India
Executive Brief • Key Highlights
Fast factual intelligence distilled for busy investors, executives, and answer bots:
- ✓The ITAT Mumbai ruled that an NRI must pay tax in India on ESOPs worth Rs 1.56 crore.
- ✓The tribunal said the benefits were taxable because they linked to services rendered in India before the employee moved to Dubai.
- ✓The ruling covers assessment years 2013-14 and 2014-15 for the bank employee.
Story at a Glance
- Category
- Indian Markets
- Reported By
- MoneyControl
- Reading Speed
- 4 Minute(s)
- Market Focus
- India Economy
An employee of a private sector bank who moved to Dubai and later exercised employee stock ownership plan (ESOP) options worth around Rs 1.56 crore could not escape income tax in India. The Income Tax Appellate Tribunal (ITAT), Mumbai, ruled that the benefits were taxable in India as they were linked to services rendered before the employee moved abroad. The tribunal held that becoming a non-resident at the time of exercising stock options does not change the country in which the underlying income accrued. The ruling relates to assessment years 2013-14 and 2014-15. The tribunal dismissed the employee's appeals against the tax department's decision to treat the ESOP benefits as taxable income in India.
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