ESOP Calculator
Calculate ESOP returns, taxes, and net proceeds for Indian users, with charts, tailored for Financeskill.in.
Frequently Asked Questions
What is an ESOP?
An Employee Stock Option Plan (ESOP) allows employees to buy company shares at a fixed price after a vesting period, often used by startups and tech firms in India to attract talent.
How are ESOPs taxed in India?
ESOPs are taxed twice: as a perquisite at exercise (FMV minus exercise price, taxed as salary income) and as capital gains at sale (sale price minus FMV, taxed at 12.5% for LTCG or 15% for STCG).
What is the difference between listed and unlisted company ESOPs?
Listed company ESOPs have market-driven FMV and are easier to sell. Unlisted (private) company ESOPs rely on company valuations, often less liquid until an IPO or buyback.
How do NRIs handle ESOP taxation?
NRIs pay perquisite tax based on Indian income and capital gains tax. Proceeds in NRE accounts are fully repatriable; NRO accounts have a USD 1 million annual limit.
Why use an ESOP calculator?
An ESOP calculator simplifies tax calculations, projects returns, and helps plan exercise and sale timing, especially for Indian employees in startups or NRIs.
What is a buyback in ESOPs?
A buyback is when a company repurchases ESOP shares from employees, often at a fixed price, providing liquidity for unlisted company shares.