Budget 2026: I-T Dept explains why share buybacks will now be taxed as capital gains
Until now, share buybacks were taxed in a split manner — the proceeds were treated as dividend income, while the extinguishment of shares was considered a capital loss. According to the tax department, this structure created unintended hardships, particularly for retail investors.
Until now, share buybacks were taxed in a split manner — the proceeds were treated as dividend income, while the extinguishment of shares was considered a capital loss. According to the tax department, this structure created unintended hardships, particularly for retail investors.
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