Team Blitz India
NEW DELHI: The Income Tax Department has proposed to exempt Sebi-registered FPIs, pension funds and SWFs from the purview of angel tax.
The Finance Act, 2023, had amended Section 56(2)(viib) of the I-T Act, thereby bringing overseas investment in unlisted closely held companies, except DPIIT- recognised startups, under the angel tax net.
Start-ups and venture capital industry have sought exemption for certain overseas investor classes.
In a statement, the Central Board of Direct Taxes (CBDT) outlined the proposed changes in Rule 11UA or valuation rules, leading dailies reported on May 20.
It also listed out entities proposed to be exempted from the angel tax ambit, such as central banks, Sovereign Wealth Funds (SWFs), international or multilateral organisations or agencies. These include entities controlled by the government or where ownership of the government is 75 per cent or more.
