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<ul><li>The buyback will include over 270 employees globally and eligible employees will participate in the repurchase and liquidate 40 per cent of their vested <keyword id="120103" type="General" weightage="100" keywordseo="esop" source="Orion">ESOP</keyword> units.</li><li>The company said that at 5x the book price of each unit, this programme provides liquidity options and will be a wealth-creation opportunity for the organization's leading employees.</li></ul>Data science and AI solutions company Tredence on Thursday announced its largest ESOP (employee stock ownership plan) buyback programme worth $30 million (about Rs 240 crore) on the heels of a Series B funding of $175 million from <keyword id="312345" type="General" weightage="50" keywordseo="advent-international" source="Orion">Advent International</keyword>. The buyback will include over 270 employees globally and eligible employees will participate in the repurchase and liquidate 40 per cent of their vested ESOP units. The company said that at 5x the book price of each unit, this programme provides liquidity options and will be a wealth-creation opportunity for the organization's leading employees. "The buyback programme will recognise and reward employees who strive every day to make Tredence the most indispensable analytics company on the planet," said <keyword id="6941917" type="General" weightage="50" keywordseo="shub-bhowmick" source="Orion">Shub Bhowmick</keyword>, CEO and Co-founder, Tredence. Tredence currently employs 2,000 people, with 80 per cent of the workforce in India. By the end of 2023, the company plans to expand its workforce to 3,000 and nearly 700 of new employees will be hired in India. Additionally, the expansion will create jobs in North America, Canada and the UK. The company also plans to open a near-shore delivery centre in Latin America. "This investment is a testament to our commitment to creating value for our employees and providing them with meaningful wealth-creation opportunities," said <keyword id="16449269" type="General" weightage="50" keywordseo="pratap-daruka" source="Orion">Pratap Daruka</keyword>, Chief Financial Officer, Tredence. In 2022, Tredence doubled its revenue while raising $175 million in Series B funding from Advent International to strengthen vertical capabilities and reach a broader customer base. Headquartered in San Jose, California, the company embraces a vertical-first approach and an outcome-driven mindset to help clients win and accelerate value realization from their analytics investments. SEE ALSO: <a href="https://www.businessinsider.in/science/news/china-clones-three-super-cows-to-produce-milk-by-the-gallons/articleshow/97570773.cms">Holy Cow! China clones three 'Super Cows' to produce milk by the gallons</a> <a href="https://www.businessinsider.in/tech/mobile/news/rumors-suggest-oneplus-is-testing-v-fold-and-v-flip-foldable-smartphones/articleshow/97448675.cms">Rumors suggest OnePlus is testing V Fold and V Flip foldable smartphones</a>

Data AI firm Tredence announces ESOP buyback worth ₹240 cr, 270 workers to benefit

<ul><li>In case of listed companies where the market value of the share is lower than the predetermined price in <keyword id="120103" type="General" weightage="80" keywordseo="esop" source="Orion">ESOP</keyword>, the employee should not exercise the option.</li><li>It is crucial to consider the company's financial health and growth prospects when assessing the worth of ESOPs.</li><li>You can sell a portion of the shares obtained through exercising your ESOPs right away to cover the costs associated with exercising, including any taxes owed.</li></ul>A few days ago, Infosys offered 5.11 lakh shares to its employees under Employee Stock Ownership Plans (ESOPs). ESOPs are extensively employed by corporations worldwide to incentivize employees to become stakeholders in the company. By offering employees the opportunity to own equity in the company, ESOPs aim to align their performance and dedication with the organization's success. In recent years, ESOPs have gained significant popularity, particularly among startups, as an effective tool for attracting and retaining top talent. Startups leverage ESOPs to not only reward employees but also to create a sense of ownership and motivation, driving their commitment and contribution to the company's growth.We take a look at what you need to keep in mind when exercising your stock options. “Under ESOP, employers grant options to its employees which are exercisable against company’s shares at future date, on fulfillment of defined vesting conditions. For this purpose, the employee pays the exercise price (set as zero or less than fair market value (FMV)) at the time of exercise of shares in future. Therefore, no upfront costs are associated with ESOPs at the time of grant,” says Akhil Chandna, Partner, Tax, <keyword id="10410446" type="General" weightage="50" keywordseo="grant-thornton-bharat" source="Orion">Grant Thornton Bharat</keyword>, a professional services firm. <cmsannotation type="cmsannotation" annotationid="Understanding exercise options" comment="subhead" text="Understanding exercise options">Understanding exercise options</cmsannotation> “Most reputed companies have a vesting period of four years, with 25% of the ESOPs becoming eligible for exercise each year after the initial one-year cliff. This means that after the first year, employees can exercise 25% of their ESOPs and subsequently exercise 25% over the following three years on a monthly pro-rata basis,” says Ajinkya Kulkarni, Co-Founder, and CEO, <keyword id="12504599" type="General" weightage="50" keywordseo="wint-wealth" source="Orion">Wint Wealth</keyword>, an online investment platform focussed on fixed income products. There are two common types of approaches when it comes to exercise prices. The first approach sets the exercise price as the face value of the shares. Thus it is significantly cheaper for employees to purchase the shares. The second approach involves the employee paying the market value of the shares at the time of exercising the option, where the exercise price would be higher. Employee-friendly companies may offer an exercise period of up to 10 years after the employee leaves the organization, providing greater liquidity opportunities for employees. “A sufficient exercise window is crucial since the notional gains from exercising an option are immediately taxable for employees, even though the actual wealth is realized upon liquidation of the shares,” says Kulkarni. <cmsannotation type="cmsannotation" annotationid="What to keep in mind when exercising options" comment="subhead" text="What to keep in mind when exercising options">What to keep in mind when exercising options</cmsannotation> When exercising an option see if there is a condition that the option will lapse if you do not exercise. “Then you should exercise. But if there is an option that it will be carried forward, there is no need to exercise immediately,” says <keyword id="5754055" type="General" weightage="50" keywordseo="bm-singh" source="Orion">BM Singh</keyword>, ESOP Expert &amp; Managing Partner, BMSA Consultancy. The actual value of ESOPs in a company is closely tied to its future performance and market valuations. Even if ESOPs hold a significant monetary value on paper, if the company's performance is poor, their true benefits may be limited. It is crucial to consider the company's financial health and growth prospects when assessing the worth of ESOPs. Ultimately, ESOPs are most advantageous when granted by companies with strong performance and promising future prospects.Therefore, employees should conduct thorough background research before accepting an offer that includes a substantial ESOP component. Chandna says that in the case of listed companies where the market value of the share is lower than the predetermined price in ESOP, the employee should not exercise the option. For unlisted companies, the employee should also research the company’s buyback track record during the vesting period and whether the company will raise capital through a funding round etc, to know the exit possibilities. <cmsannotation type="cmsannotation" annotationid="Tax implications at the time of exercise" comment="subhead" text="Tax implications at the time of exercise">Tax implications at the time of exercise</cmsannotation> Taxability of ESOPs first occurs at the time of exercising the options, where the perquisite value of the ESOPs is deemed taxable under the category of 'salary' in the hands of the employees. When employees exercise their ESOPs, the difference between the fair market value of the shares at the time of exercise and the exercise price is treated as a taxable perquisite. This value is added to the employee's salary and subject to applicable income tax regulations. “Please note that the taxable value of perquisite would be computed basis the date of exercise of options /units, however, the same would be taxable in the year in which shares are actually allotted/ transferred to the employees,” says Chandna. <table style="border-width: initial; border-style: none;" class="redcator-table-advance"></colgroup><tbody><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;background-color:#ffffff;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Name of employee </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;background-color:#ffffff;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">A </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;background-color:#ffffff;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Grant date of ESOP </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;background-color:#ffffff;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">1 April 2023 </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;background-color:#ffffff;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Vesting date of ESOP </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;background-color:#ffffff;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">1 April 2024, 1 April 2025 (50% at each date) </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;background-color:#ffffff;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Exercise date of ESOP/date of allotment of shares </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;background-color:#ffffff;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">1 April 2026 </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;background-color:#ffffff;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">FMV as on Exercise date i.e. 1 April 2026 </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;background-color:#ffffff;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">₹1,000 </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;background-color:#ffffff;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Exercise price </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;background-color:#ffffff;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">₹100 </td></tr></tbody><tbody></tbody><tbody></tbody></table> In the above illustration, the taxability would arise in the hands of Mr. A on exercise date i.e. 1 April 2026 (FY 2026-27). The taxable value would be ₹900 (i.e. ₹1000 as reduced by ₹00) on 1 share. Source: <keyword id="131240" type="General" weightage="80" keywordseo="grant-thornton" source="Orion">Grant Thornton</keyword> <cmsannotation type="cmsannotation" annotationid="How to minimize out of pocket expenses when exercising ESOPs" comment="subhead" text="How to minimize out of pocket expenses when exercising ESOPs">How to minimize out of pocket expenses when exercising ESOPs</cmsannotation> “To minimize the duration between tax obligations on notional gains and the actual gains, it is advisable to exercise ESOPs closer to liquidity events,” says Kulkarni. You can sell a portion of the shares obtained through exercising your ESOPs right away. The proceeds from the sale can be used to cover the costs associated with exercising, including any taxes owed. This strategy effectively lowers your out-of-pocket expenses by utilizing the funds generated from selling the shares. “Let us say that you are entitled to exercise 50 shares. If you get a chance to sell 10 shares in the secondary market, then you can sell the shares and cover the expenses from the proceeds,” says Singh. By creating a budget and developing a financial plan, you can ensure that you have the necessary funds for exercising ESOPs while minimizing your out-of-pocket expenses. Through careful financial management, such as setting aside money in advance or reallocating your financial resources, you can mitigate the impact on your personal expenses when it comes time to exercise your ESOPs.

What you need to know when you exercise your stock option plan

<ul><li>When exercising your ESOP options, you need to pay for the shares at the exercise price. </li><li>There may be an additional tax burden if the <keyword id="173739" type="General" weightage="20" keywordseo="esops" source="Orion">ESOPs</keyword> are provided at a value lower than the fair <keyword id="6463972" type="General" weightage="20" keywordseo="market-value" source="Orion">market value</keyword> at the time of vesting. </li><li>If the company fails to perform well, or lacks successful liquidity events, the potential returns on ESOPs may remain unrealised. </li></ul>When talking about the glitzy world of start-ups, a discussion on employee stock ownership plan (ESOPs), always comes up. In recent news Swiggy announced that it will buy back shares worth $50 million from employees. Also, Paytm granted 1.7 million new ESOPs to employees. A few weeks ago Flipkart announced a $700 million ESOPs payout. However, the world of ESOPs may not all be as rosy as it seems at first glance. ESOPs work in a certain way and there are a lot of factors which need to fall into place before an employee can make a profit out of them. Therefore, one needs to understand that with start-ups coming under a lot of pressure due to an uncertain economic scenario and a funding crunch, have ESOPs lost their charm? “ ESOPs are often offered to outstanding performers to foster a sense of ownership, and nowadays, start-ups use them as a means to attract and retain top talent. However, it is essential to be aware that some companies might also offer ESOPs to compensate for situations when they cannot offer competitive salaries,’ says Anjali Raghuvanshi, Chief People Officer, Randstad India, a HR consulting firm. What this essentially means is that when taking up a job offer, do note if ESOPs are a part of the salary package as this may come at the cost of foregoing some salary. It is important to understand two major risks associated with ESOPs. Let us take a look. <cmsannotation type="cmsannotation" annotationid="You would need to fork out money upfront" comment="subhead" text="You would need to fork out money upfront">You would need to fork out money upfront</cmsannotation> Here is where owning ESOPs can get tricky. “There are two up-front costs you have to bear when you are exercising your ESOP options. The first cost is the amount you pay the company for those ESOPs,” says BM Singh, ESOP Expert &amp; Managing Partner, BMSA, a consulting firm. Suppose an employee is granted 1,000 ESOP options by a company. The exercise price or strike price of each option is ₹100. This means that the employee can purchase the company's shares at ₹100 per share at a future date, regardless of the market price at that time. Now, let's assume that the market price of the company's shares increases to ₹150 when the employee decides to exercise their ESOP options. To exercise the options, the employee needs to pay the exercise price, which is ₹100 per share. The cost to the employee to exercise their ESOP options would be ₹100,000. <cmsannotation type="cmsannotation" annotationid="Additionally, there may be a tax implication" comment="subhead" text="Additionally, there may be a tax implication">Additionally, there may be a tax implication</cmsannotation> The next is the tax implication that arises here. If the ESOPs are granted at a value lower than the fair market value during vesting, there could be an extra tax burden, resulting in potential tax liabilities before fully realising the value of the ESOPs. “ESOPs are taxable in the hands of the employees as perquisite u/s 17(2) of the IT Act. The taxable amount of such perquisite would be the fair market value (FMV) of the shares (computed in accordance with Rule 3(8) of the IT Act) on the date of exercising such option less any amount paid by the employee for such ESOPs,” says Suresh Surana, Founder, RSM India, an audit, tax and consulting firm. In the above example, the employee would need to pay tax on the taxable amount of ₹50,000 at the applicable tax rate. The exact tax amount will depend on the individual's income tax slab rate. <cmsannotation type="cmsannotation" annotationid="A bigger concern" comment="subhead" text="A bigger concern">A bigger concern</cmsannotation> Poor company performance and uncertainty of liquidity events may render ESOPs worthless. “If the company fails to perform well or lacks successful liquidity events, the potential returns on ESOPs may remain unrealised, potentially impacting the value of the effort and time invested over the years, “ says Raghuvanshi. The value of ESOPs is closely tied to the company's performance and growth potential. If the company's value decreases, it can negatively impact the value of your stock options, potentially making it challenging to sell your shares at a profit. Hence, it is important for an employee to evaluate the future prospects and growth of a company before making a decision to exercise the option. When an employee exercises the options, he should have trust in the company's future growth and performance. “The employee should also be aware about the exit possibilities in case of unlisted shares i.e. buyback track record, funding rounds etc,” says Akhil Chandna, Partner, Tax, Grant Thornton Bharat, a professional services firm. When exercising ESOPs, it is thus essential to conduct a thorough assessment of the company's current performance and financial well-being. This evaluation helps the employee make informed decisions about exercising their options. “Any significant changes since joining could impact the decision,” says Raghuvanshi. <cmsannotation type="cmsannotation" annotationid="Risk of ESOPs are higher in an early stage start-up" comment="subhead" text="Risk of ESOPs are higher in an early stage start-up">Risk of ESOPs are higher in an early stage start-up</cmsannotation> If a start-up is bootstrapped or in the idea phase, the risks are higher. In that case ESOPs are merely paper money. As the different rounds happen, the value of the ESOPs and the probability of liquidity increases. “You should see at which stage of the start-up you are entering. At each phase the value of ESOPs is different. So if you are joining a company just on the basis of ESOPs and not getting a reasonable salary and the company is in its early stages, then you should also focus on the cash component,” says Singh. If it has reached the Series A or Series B funding stage, then you can consider the value of ESOPs when joining and can consider it an important part of your salary package.

Explained: What accepting ESOPs, especially if joining a start-up, might entail

<ul><li>With <keyword id="8420431" type="UNKNOWN" weightage="20" keywordseo="budget-2021">Budget 2021</keyword> around the corner, India’s IT body NASSCOM has submitted its suggestions for <keyword id="6362513" type="UNKNOWN" weightage="20" keywordseo="startups">startups</keyword> which includes further tax relaxations for employee stock ownership plans. </li><li>NASSCOM’s public policy head said that <keyword id="173739" type="PERSON" weightage="20" keywordseo="Esops">ESOPs</keyword> should be taxed only when an employee sells the shares.</li><li>During Budget 2020, Finance Minister Nirmala Sitharaman had said that ESOPs can be taxed within five years or when they leave the company or when they sell their shares, whichever is earliest.</li></ul>When India’s Finance Minister Nirmala Sitharaman announced tax relaxations for Employee Stock Ownership Plans (ESOPs) during Budget 2020, India’s entrepreneurs welcomed the decision. But one year down the line, they are having second thoughts. “The Finance Minister had relaxed the conditions with respect to the Employee Stock Ownership Plans but that’s not sufficient based on the industry feedback. What the industry really requires is that the liability of paying the tax should be deferred to the time when the shares are actually sold by the employees,” Ashish Aggarwal, Nasscom’s Public Policy head <a href="https://twitter.com/nasscom/status/1352200095735791617">shared </a>the suggestions the IT body has sent to the government. <table style="border-width: initial; border-style: none; width: 468pt; table-layout: fixed;"></colgroup><tbody><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">What Budget 2020 said </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Budget 2021 demand from NASSCOM </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">ESOPs can be taxed within five years or when they leave the company or when they sell their shares, whichever is earliest. </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">ESOPs should be taxed only when an employee sells the shares, when they have the liquidity. </td></tr></tbody></table> Entrepreneurs too agree. “Most startups, irrespective of the sector they operate in, typically take more than five years to list themselves in the stock exchange and become a listed company or carry out an exit or sell-out. Second, it does not apply to an employee who is exiting a company as an employee. So, a person who has already spent several years in a company and wishes to move on, his ESOPs earned during employment will not be eligible for deferment of taxes. In crux, I would urge the government to review these preconditions to support the startup industry at large,” said Ankit Prasad, Founder and CEO, Bobble AI. In the past year, multiple startups have been buying back shares from their employees as a way of rewarding them. Recent startups which rolled out ESOP buyback plans <table style="border-width: initial; border-style: none; width: 468pt; table-layout: fixed;"></colgroup><tbody><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Swiggy </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">$7-9 million <a href="https://entrackr.com/2020/11/swiggy-to-reward-its-employees-with-esop-liquidity-program/">(reported value)</a> </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Unacademy </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">$4 million </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Urban Company </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">$5 million </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Zerodha </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">$8.7 million </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">CRED </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">$1.2 million </td></tr></tbody></table> However, Archit Gupta, founder and CEO of ClearTax believes that just deferment of tax isn’t enough, instead some exemption of tax on sale of ESOPs should be brought in. “It can become an effective means to attract and retain talent,” Gupta told Business Insider. But a crucial question still remains – who can avail this benefit? Aggarwal said the benefit should be extended to all startups and not just eligible startups. “DPIIT on its platform has over 40,000 startups but out of that only 400 are eligible startups, who have got an approval of certification for tax benefits,” he said. SEE ALSO: <a href="https://www.businessinsider.in/defense/news/us-new-president-joe-biden-will-oppose-new-delhis-5-5-billion-deal-with-russia-for-the-s-400-missile-as-per-washington-d-c-based-expert/articleshow/80382062.cms">INTERVIEW: Joe Biden may be as harsh as Donald Trump if India insists on buying S-400 missiles from Russia, says a Washington D.C-based expert</a> <a href="https://www.businessinsider.in/business/auto/news/bajaj-auto-just-posted-a-record-quarter-as-pent-up-demand-brings-highest-ever-sales-for-its-signature-bikes-pulsar-and-boxer/articleshow/80384430.cms">Bajaj Auto just posted a ‘record quarter’ as pent up demand brings highest ever sales for its signature bikes – Pulsar and Boxer</a>

NASSCOM says Budget 2021 should ensure ESOPs are taxed only when shares are sold

<ul><li>Government is planning to bring changes to income tax laws to bring cryptocurrencies under the tax net in Budget 2022.</li><li>Also, it is likely to introduce a bill on cryptocurrencies during the Winter Session of Parliament.</li><li>This comes amid a rising number of advertisements, featuring even film stars, promising easy and high returns on investments in cryptocurrencies.</li></ul>The government is mulling changes in the income tax laws to bring cryptocurrencies under the tax net, with some changes that could form part of the budget next year, a top official said. Revenue secretary <keyword id="947916" type="General" weightage="20" keywordseo="tarun-bajaj" source="Orion">Tarun Bajaj</keyword> said that in terms of income tax, some people are already paying capital gains tax on the income from cryptocurrency, and in respect of goods and services tax (GST) also the law is "very clear" that the rate would be applicable as those in case of other services. <cmsannotation type="cmsannotation" annotationid="wazirx" comment="wazirx" text="wazirx">wazirx</cmsannotation> "We will take a call. I understand that already people are paying taxes on it. Now that it has really grown a lot, we will see whether we can actually bring in some changes in law position or not. But that would be a budget activity. We are already nearing the budget, we have to look at that point of time," Bajaj told PTI in an interview. Asked if a provision of TCS (tax collected at source) could be introduced for crypto trading, the secretary said "if we come up with a new law then we will see what is to be done". "But yes, if you make money you have to pay taxes... We have already got some taxes, some have treated it as an asset and paid capital gains tax on it," he said. Asked whether people involved in cryptocurrency trading would be categorized as facilitator, brokerage and trading platform and how the taxation would be done under GST, Bajaj said "there would already be such things available in other services also. So whatever GST rate they are taxed at, that will be applicable on them." "They have to get themselves registered. The GST law is very clear. If there is an activity, if there is a broker who is helping people and charging brokerage fee, GST would get charged," he said. Separately, the government is likely to introduce a bill on cryptocurrencies during the Winter Session of Parliament beginning November 29, amid concerns over such currencies being allegedly used for luring investors with misleading claims. Notably, there have been a rising number of advertisements, featuring even film stars, promising easy and high returns on investments in cryptocurrencies in recent times. Currently, there is no regulation or any ban on use of cryptocurrencies in the country. Against this backdrop, Prime Minister Narendra Modi, last week, held a meeting on cryptocurrencies with senior officials and indications are that strong regulatory steps could be taken to deal with the issue. Earlier this week, the Standing Committee on Finance, chaired by BJP member Jayant Sinha, met the representatives of crypto exchanges, block chain and Crypto Assets Council (BACC), among others, and arrived at a conclusion that cryptocurrencies should not be banned, but it should be regulated. The RBI has repeatedly reiterated its strong views against cryptocurrencies saying they pose serious threats to the macroeconomic and financial stability of the country and also doubted the number of investors trading on them as well as their claimed market value. RBI governor Shaktikanta Das too earlier this month had reiterated his views against allowing cryptocurrencies saying they are a serious threat to any financial system since they are unregulated by central banks. The Supreme Court in early March 2020, had nullified the RBI circular banning cryptocurrencies. Following this on February 5, 2021, the central bank had instituted an internal panel to suggest a model of the central bank's digital currency. The RBI had announced its intent to come out with an official digital currency, in the face of proliferation of cryptocurrencies like Bitcoin about which the central bank has many concerns. Private digital currencies/virtual currencies/crypto currencies have gained popularity in the past one decade or so. Here, regulators and governments have been sceptical about these currencies and are apprehensive about the associated risks. It can be noted that on March 4, 2021, the Supreme Court had set aside an RBI circular of April 6, 2018, prohibiting banks and entities regulated by it from providing services in relation to virtual currencies. SEE ALSO: <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/business/startups/news/phonepe-announces-esop-buyback-worth-135-crore-for-employees/articleshow/87802097.cms">PhonePe announces ESOP buyback worth ₹135 crore for employees</a> <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/cryptocurrency/news/what-is-bitcoin-golden-cross-and-death-cross/articleshow/87796591.cms">Bitcoin investors love the golden cross and death cross — here’s why they matter but there are other factors to keep in mind</a> <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/business/startups/news/mindhouse-raises-6-million-in-seed-funding-led-by-binny-bansal/articleshow/87798613.cms">Flipkart's Binny Bansal bets on Zomato cofounder's two-year-old venture</a>

Government plans to tax cryptocurrency gains in Budget 2022

<ul><li>US-based electric vehicle maker Triton is looking to hire new talent in India as the company gears up to tap the country's sedan segment.</li><li>In an exclusive interview with Business Insider, the company's founder and CEO, Himanshu Patel, revealed that they plan to hire roughly between 5,000 to 10,000 people over the next year (2021- 2022)</li><li>The company currently has its research and development unit set up in Pune, and is also in talks with different state authorities to set up its facility in India.</li><li>Check out the latest news and updates on <a href="https://www.businessinsider.in/">Business Insider</a>.</li></ul>US-based electric vehicle maker Triton is looking to hire new talent in India as the company gears up to tap the car segment in the country with its electric sedan N4. For the uninitiated, Triton is looking to invest around $650 million to $1 billion in setting up a manufacturing facility in India. In an exclusive interview with Business Insider, the company's founder and chief executive officer (CEO), Himanshu Patel, revealed that they plan to hire roughly between 5,000 to 10,000 people over the next year (2021- 2022) and about 35,000 to 40,000 people over the next five years in India. The company has been actively recruiting and posting jobs on its LinkedIn page. The company, in a written response, said they are looking to hire graduates in the automotive industry for segments such as mechanical, IT, Artificial intelligence, and Internet of things. "They could be engineering grads, diploma holders and technical people," the company said. Triton recently posted a job opening for an entry-level position for "<a href="https://www.linkedin.com/jobs/view/2388169063/?refId=Xx1wfMMFrurRoNrFGlZyqA%3D%3D&amp;trackingId=tnespGZPix6mmrh71AYjNg%3D%3D">embedded design engineer</a>" in Mumbai. The company currently has its research and development unit set up in Pune, and it is also in talks with different state authorities to set up its facility in India. However, the CEO declined to give further details. Responding to a query on average salary, the company said it would be too early for them to comment as they are still finalising a few of the job contracts. Patel, in an interview, told Business Insider that the company has been hiring for quite a while now without revealing many details in public. He had then said the company would slowly put out job listings on its LinkedIn pages and other resources. Patel said the company has a huge fan following about 8 million users on LinkedIn, which helps them identify a lot of employment opportunities. The company has huge plans for India Triton said it had modified the models as per the need of Indian citizens adding a solar roof to feed the battery when stuck in traffic jams and promising long battery life. Patel further explained that the solar panel in their car could generate up to 1.3 kilowatts per hour, reducing the air conditioning from a 3 KW draw to a 1.3 KW draw. “This offsets the losses of mileage or kilometres in India. By just doing this, we are saving about close to 30% of the battery for being used during traffic times,” he added. The New Jersey-based electric car maker Triton also recently roped in India’s state-owned Bharat Electronics Limited (BEL) to make batteries. “Through this partnership we aim to produce an innovative ‘Make In India’ product which will transform the Indian EV and ESS segment,” Patel added. SEE ALSO: <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/business/telecom/news/how-the-latest-spectrum-auction-may-affect-your-mobile-phone-bills-and-quality-of-network-service/articleshow/81325496.cms">Here’s how the latest spectrum auction may affect your mobile phone bills and quality of service</a> <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/business/startups/news/razorpay-set-to-buyback-esops-worth-10-million-investors-sequoia-and-gic-will-be-the-buyers/articleshow/81324622.cms">Razorpay set to buyback ESOPs worth $10 million – investors Sequoia and GIC will be the buyers</a>

An American electric car maker is on a hiring spree in India — plans to add 10,000 jobs over the next year

<ul><li>The Indian government’s new rules for social media platforms like <keyword id="6354576" type="UNKNOWN" weightage="20" keywordseo="facebook">Facebook</keyword> and Twitter mandates the ‘voluntary’ verification of users.</li><li>According to <keyword id="6355041" type="ORGANIZATION" weightage="20" keywordseo="mozilla">Mozilla</keyword>, this could potentially put personal data at greater risk of being hacked.</li><li>Doosra, an Hyderabad-based startup, is offering a way, for users worried about their privacy, to create an alternative digital identity.</li></ul>Facebook, <keyword id="790242" type="COMPANY" weightage="20" keywordseo="WhatsApp">WhatsApp</keyword>, Twitter and other social media platforms have been asked to <a href="https://www.businessinsider.in/tech/enterprise/news/mozilla-is-not-happy-with-indias-new-it-rules-claiming-there-arent-enough-checks-and-balances-in-place/articleshow/81308608.cms">verify the identity of their users</a> — this could be either through phone numbers or government-issued IDs like the Aadhaar card. Putting your number online is not just a risk in the face of <a href="https://www.businessinsider.in/news/a-scary-proposal-to-use-facial-recognition-and-ai-by-an-indian-state-has-experts-fuming/articleshow/80421935.cmshttps://www.businessinsider.in/news/a-scary-proposal-to-use-facial-recognition-and-ai-by-an-indian-state-has-experts-fuming/articleshow/80421935.cms">increasing government surveillance</a>. It is also about privacy and online safety since personal data can have in-real-life (IRL) consequences like being targeted by stalkers, trolls or people looking to hack into your bank account. “Where there is personal data, there is a great risk of hackers trying to steal it,” pointed out <a href="https://www.businessinsider.in/tech/enterprise/news/mozilla-is-not-happy-with-indias-new-it-rules-claiming-there-arent-enough-checks-and-balances-in-place/articleshow/81308608.cms">Mozilla</a> in a statement. An Indian startup based in Hyderabad called <a href="https://www.doosra.com/about-us">Doosra</a> has a possible solution. Instead of using your real number to sign up, use an alternative number to create a secondary digital identity. This doesn’t mean going out to buy a new SIM, but creating a second app-based ‘virtual’ number. “The only people that will have any kind of access to your primary number would be if we got an executive order from the official authorities,” <a href="https://www.linkedin.com/in/adityavuchi/?originalSubdomain=in">Aditya Vuchi</a>, founder and chief executive of Doosra told Business Insider. This means that if your social media handle is found to be a part of any activity, which violates Section 69 of the IT Act, the government or Supreme Court will first have to issue an order to the social media platform. If and once they discover that the mobile number given is a Doosra number, they will have to issue another order to Doosra in order to gain access to your primary number. The trouble with mobile numbers Mobile phone numbers started out as a simple communication tool. Their purpose was simply to allow your friends and loved ones to reach you no matter where you were. Over time, mobile phone numbers turned identifiers for business databases — a way for them to keep track of their customers — before turning into an all out marketing tool. The Indian government’s mandate to use phone numbers as a way of <a href="https://www.businessinsider.in/policy/news/indias-new-rules-for-facebook-whatsapp-and-other-social-media-platforms-explained-in-five-points/articleshow/81285658.cms">‘voluntary’ verification</a> — a know-your-customer process, of sorts — for accessing these online platforms poses a new threat. “This means that any message you share on WhatsApp, Facebook and other platforms that is re-shared, makes your number that much more accessible to various databases, leading to spam from real estate offers, insurance scams, stalkers and worse,” said Vuchi. Addressing the deficit of trust The six-month old Doosra is the first such service to be available in India. It is not that other such apps don’t exist — like 2ndLine, Hushed, and Burner — but you need an American or Canadian number in order to sign up for them. Doosra caters to numbers based out of India. You need your real number to sign up for the service, and it is not free with plans starting at ₹59 per month for essential services and ₹83 per month for the pro package. The Doosra number can be used to sign up for <a href="https://www.businessinsider.in/tech/apps/news/whatsapp-signal-and-telegram-face-a-catch-22-situation-as-indias-new-social-media-rules-threaten-encryption/articleshow/81221070.cms">WhatsApp</a>, Twitter and others or given for Aadhaar, banking details and subscriptions. This is because all of these services require an OTP for verification and Doosra logs all the incoming messages on your <keyword id="10867302" type="UNKNOWN" weightage="20" keywordseo="secondary-number">secondary number</keyword>. “I bought a car very recently. And, throughout the entire cycle, neither the sales guy or the paperwork guy has access to my primary number. They only had access to my Doosra number,” said Vuchi. According to him, most people using the app so far are addressing a ‘deficit of trust’. They’re uncertain of how their number will be used — or misused — if they give it out to a third party, which is not surprising considering that when you go online to shop for insurance, at a portal like PolicyBazaar, they want you to share your number before you can even compare rates and figure out what you want. The startup did not share the exact number of subscribers it has so far, but Vuchi did disclose that Doosra has seen just shy of a million messages and around 25,000 business sender IDs have been detected. “We can’t see what the messages are, but we do know when businesses reach out to the consumers” he explained. The key clientele so far has been small business owners, sales professionals, and, in some cases, actors too. But with the walls closing in around a person’s digital identity and privacy turning into a luxury that very few can afford — Doosra expects business to boom in the future. SEE ALSO: <a href="https://www.businessinsider.in/business/startups/news/razorpay-set-to-buyback-esops-worth-10-million-investors-sequoia-and-gic-will-be-the-buyers/articleshow/81324622.cms">Razorpay set to buyback ESOPs worth $10 million – investors Sequoia and GIC will be the buyers</a> <a href="https://www.businessinsider.in/tech/enterprise/news/mozilla-is-not-happy-with-indias-new-it-rules-claiming-there-arent-enough-checks-and-balances-in-place/articleshow/81308608.cms">Mozilla is not happy with India's new IT rules claiming there aren't enough checks and balances in place</a> <a href="https://www.businessinsider.in/business/news/indian-companies-stand-to-lose-7-14-lakh-crore-to-climate-change-but-they-could-end-up-making-2-9-lakh-crore-too/articleshow/81306789.cms">Indian companies stand to lose ₹7.14 lakh crore to climate change — but they could end up making ₹2.9 lakh crore too</a>

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Data AI firm Tredence announces ESOP buyback worth ₹240 cr, 270 workers to benefit

IANS

What you need to know when you exercise your stock option plan

Anagh Pal

Explained: What accepting ESOPs, especially if joining a start-up, might entail

Anagh Pal

NASSCOM says Budget 2021 should ensure ESOPs are taxed only when shares are sold

Sanchita Dash

Government plans to tax cryptocurrency gains in Budget 2022

PTI

An American electric car maker is on a hiring spree in India — plans to add 10,000 jobs over the next year

Navdeep Yadav

This spam blocker may add a layer of anonymity to your social media presence while Twitter and Facebook are under pressure to verify their users

Prabhjote Gill

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