F A Q's
Are unlisted shares in Physical form or Demat form?
Unlisted shares can be in either Physical for or Demat form. Demat shares are easier and safer.
Do I need a trading account and Demat Account to buy Unlisted Shares?
Only a Demat account (NSDL or CDSL) is required.
What is the capital gains tax treatment of investing in unlisted shares?
Short Term Capital Gains are taxed at the respective income slab rate of the assessee.
Long Term Capital Gains are taxed at 20% with indexation.
Holding period of the stock for treating Gain/Loss as long term is 24 months.
Last updated:30th July 2021
Is there any Locking period, if yes, for how long?
No, unless the company floats an IPO.
If the company goes for an IPO, their entire Pre-IPO capital is locked in for a period of 1 year in accordance with SEBI’s Investor Protection guidelines.
SEBI (Disclosure and Investor Protection) {DIP} Guidelines, 2000 and its amendments from time to time require that the entire Pre-IPO Capital* will be locked-in for a period of 1 year from the IPO.
*Except shares held by SEBI registered VC Funds and FVCI held for more than 1 year.
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