A growing number of promoters are now holding their company shares through trusts. As per Prime Database, as on October 2025, among the 2,757 companies listed on the NSE, promoters of ~880 of these companies hold their shares through different trust structures- private, public or Family Trust driven by the need to safeguard wealth, enhance […]
With globalization being at its peak, Employee Stock Ownership Plans (ESOPs) have now become a popular tool for rewarding and retaining talent, especially in multinational companies that operate across the world. While foreign ESOPs are employees’ opportunity to build wealth and a sense of ownership, there are also significant compliance obligations under Indian tax and […]
Introduction In the ever-evolving landscape of startup funding, there’s a growing trend where angel and seed-stage investors or venture capitalists encourage founders to establish Employee Stock Option Plans (ESOPs) before investing in them. This shift in investor demand has given rise to a common challenge for the founders to agree to create ESOP pools during […]
Employee Stock Option Plans (ESOP), is a widely adopted methodology used by modern startups, notably established in Silicon Valley by companies like Google and Facebook during their initial stages. The success of this strategy has been mirrored in the Indian market by companies like Flipkart, Citrus Pay, and many other startups. When these startups made […]
Employee Stock Option Plans (ESOPs) have proven to be effective in retaining a talented workforce, preserving cash flows, increasing productivity and achieving enhanced profitability globally. Cross-border ESOP structures may be explored by various global businesses already established in India, as well as by investors intending to establish a greenfield presence or acquire operating businesses in […]
Employee Stock Ownership Plan (ESOP) provides an opportunity for employees to become part owners of stock in the company they work for, at a discounted price. By embracing ESOPs, Family-owned businesses (FOBs) can foster a thriving work environment where employees truly feel invested in the company’s achievements. This often encourages employees to be a part […]
ESOPs are a simple and effective method for fostering employee engagement in the company. ESOPs have proven to be a valuable tool in the startup ecosystem, motivating top talent and promoting employee retention. The statistics further validate this trend, with data from Inc42 Plus indicating that in 2022, Indian startup employees reaped over $196.5 million […]
Employee stock option plan (ESOP) are liquid assets for listed companies as employees can see their value or wealth created. In the case of Startups or unlisted companies, ESOPs cannot be sold in an open market. To mitigate this problem, many startups have started buying back the ESOPs issued to their employees, thereby providing them […]
<h1ESOP Taxation Employee stock option plan (ESOP) are granted to eligible employees, who may exercise such options to acquire equity shares of the company in the future and at a predetermined exercise price. Such shares may be acquired subject to the conditions being met as per the plan. ESOPs will form part of the taxable […]
ESOP Taxation ESOP Taxation is the most significant factor in determining the creation of wealth through ESOPs. When it comes to ESOP taxes, there are 2 instances when taxes are paid that is (i) At the time of exercise of ESOP and (ii) At the time of sale of ESOP’s. Let us understand the implication […]
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