No GST on ESOPs by foreign cos in India

New Delhi: ESOPs given by foreign companies to employees of its Indian subsidiary at prevailing market value will not attract GST, the CBIC has said.

However, Employee Stock Option (ESOP)/Employee Stock Purchase Plan (ESPP)/ Restricted Stock Unit (RSU) provided by a foreign company to its India subsidiary employee would come under GST net if an additional amount over and above the cost of securities/shares is charged by the foreign holding company from the domestic arm.

This clarification forms part of the 16 circulars issued by the Central Board of Indirect Taxes and Customs (CBIC), following the meeting of the GST Council on June 22.