Redemption of Stock Appreciation Rights Taxable as Capital Gains & Not Perquisite !

Stock Appreciation Right (SAR) are part of various kinds of stock options used by companies to incentivize and keep the employee with them. In case of Stock Appreciation Right (SAR) , the employee does get shares or cash payments equivalent to appreciation in the value of shares of the company.So , world over ,Stock Appreciation Right (SAR) is one of the alternatives adopted for implementing an equity based compensation plan .SARs can be structured as either ‘Equity settled–SARs’ or ‘Cash settled–SARs’.

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