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Govt defers FBT payment on Esops to Sept 15
June, 15th 2007

The finance ministry has extended by three months the deadline for payment of the first installment of fringe benefit tax (FBT) on employee stock option schemes (ESOPs). The companies were earlier scheduled to pay the first installment of the tax on Friday.
 
The 2007-08 Budget had announced a levy of fringe benefit tax on stock options. However, the Central Board of Direct Taxes is yet to arrive at a methodology for determining the fair market value of shares given under ESOPs.
 
In the absence of a method for determination of fair market value, it will not be possible for an employer to determine the value of the first installment of FBT in respect of allotment shares to its employees, a government release said.

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