Tax exemption to start ups- now Start ups can issue shares at higher than fair market value.

As per  section 56(viib) if companies issue shares higher than the fair market value of shares ,then the same should include in taxable income of the company .

Through notification no.45/2016 –The CBDT exempt the start ups under section 56(viib).

Now the starts up can issue shares to investors at higher than the fair market value without any tax consequences.

For more details, watch the following video