When a company buys back listed shares, the shareholder may be taxed on distributed income under Section 115QA at the rate notified, with no further tax on the same amount in most cases.
Investor actions
- Check company letter and TDS certificate if any
- Report buyback consideration in ITR schedule
- Compare with capital gains route where buyback is not under 115QA
- Companies coordinate buyback procedure with ROC and SEBI rules
Companies use ITR-6 filing; shareholders use ITR-2 and Section 112A guide.
