Swiggy offers $65 million ESOP buyback before its IPO: Check eligibility, taxation
New Delhi: Swiggy has announced a $50 million ESOP buyback plan for its employees ahead of its anticipated IPO. This buyback will involve approximately 2,000 employees, including those from Dineout, which Swiggy recently acquired. The initiative is part of Swiggy’s ongoing efforts to reward and retain talent, marking the fifth ESOP buyback since 2018
Eligibility and Participation
Eligible employees include those who hold ESOPs granted by Swiggy. The company has previously implemented programs like the “Build Your Own Dollar” (BYOD), which allows all permanent employees to invest in Swiggy’s ESOPs, expanding participation beyond higher-grade or performance-based criteria
Taxation
The taxation on ESOPs generally includes two phases:
- At the time of exercising the options: The difference between the exercise price and the fair market value of the shares is taxed as perquisites under the head ‘Salary’.
- At the time of sale: The gains are taxed as capital gains. If the shares are held for more than 24 months, they qualify for long-term capital gains tax, which may be eligible for indexation benefits.
These regulations may vary, and employees should consult with a tax advisor to understand their specific tax liabilities.
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