Dear Upstox Support Team,
I need urgent assistance regarding stocks that were gifted to me by my spouse and transferred via CDSL Easiest from Zerodha to my Upstox account.
Previously, Upstox provided an option to input the average acquisition value for such stocks, which I had updated with complete breakup details. However, while preparing my Income Tax Return (ITR), I noticed that the AIS (Annual Information Statement) does not reflect the cost of acquisition for these stocks. As a result, the entire sale value is being incorrectly treated as Short-Term Capital Gains (STCG).
Despite raising this concern, your support team has repeatedly closed the request without providing any resolution or even a basic response. This lack of accountability is deeply disappointing.
Please advise on how to rectify this issue and ensure the cost of acquisition is properly reflected to avoid incorrect tax implications.
Thanks,
@SUNITA_31875847 - Could you please raise a fresh ticket and share the Ticket ID with me with all the relevant screenshots? I’ll raise it internally, thanks.
Please find the new ticket ID 9515166. Please go through with my request and let me know what details you need.
@SUNITA_31875847 - Your ticket ID 9515166 is now resolved. Please check and let us know, thanks.
I don’t know why its closing the ticket. There is nothing mentioned about the Unlisted stocks which is getting unlocked after the IPO . There is no way to show the value of those stocks. How i can use Upstox incomplete report for ITR purspose.
Hi @SUNITA_31875847,
Our team tried calling you multiple times regarding this. However, incoming calls were not available in your number. Could you provide us with an alternate number and an appropriate time when we can reach out to you today? Thanks.
I am available on the following whatsapp number only as I am outside India as of now.
9012780364(whatsapp)
Dear Upstox Team and Community,
I need guidance on handling unlisted stocks that later get unlocked post-IPO. Specifically:
-
Average Acquisition Value:
How can I manually input the average acquisition cost for such stocks in Upstox, especially when they were gifted or transferred via CDSL Easiest? Is there a provision to update this for accurate tax reporting?
-
P&L Calculation:
Once these stocks are listed and sold, how does Upstox compute the profit/loss? Does it consider the manually entered acquisition value, or does it default to treating the entire sale amount as capital gains?
-
FIFO Treatment:
If I hold both listed stocks (purchased earlier) and newly unlocked stocks (from pre-IPO allotment or gift), how does FIFO apply when I initiate a sell order?
This is crucial for ensuring accurate ITR filing and avoiding misreporting in AIS. I’d appreciate insights from the community or Upstox support on best practices and platform limitations.
Thanks in advance!
Hi @SUNITA_31875847,
When it comes to handling unlisted shares that later get unlocked post-IPO in Upstox, there are a few important considerations to ensure accuracy in both portfolio tracking and tax reporting.
1. Average Acquisition Value: Currently, Upstox does not allow manual editing of the acquisition cost within the platform for holdings received via off-market transfer (gift, inheritance, or CDSL Easiest transfer).
- The cost of acquisition in such cases is often shown as zero in the P&L view. This may create a mismatch in reporting.
- For accurate ITR filing, you would need to maintain your own working records (purchase price, gift valuation, or the donor’s acquisition cost) and update the cost while filing your returns. Your CA or tax software can help ensure the correct cost basis is reflected.
2. P&L Calculation: When these shares are eventually listed and sold, Upstox by default will calculate profit/loss based on the acquisition value captured in its system (which is usually zero if no cost was mapped).
- This means the entire sale consideration could show up as capital gains in your Upstox P&L report.
- For tax reporting, you must override this by referring to your actual acquisition cost records. The Income Tax Department recognizes the donor’s original cost (in case of gifts) or fair valuation rules (in case of inheritance/other transfers).
3. FIFO Treatment: FIFO is applied strictly on a scrip-level, not by differentiating between listed and unlisted/unlocked lots.
- This means if you sell, the system assumes your earliest acquired quantity is being sold first, regardless of whether it came through a market purchase or an off-market transfer.
- There is currently no provision in Upstox to “tag” which lot you want to sell. FIFO is automated and cannot be manually adjusted.
We suggest that you maintain a parallel record (Excel sheet or tax software) with correct acquisition dates and costs for every lot you hold, especially for pre-IPO, gifted, or transferred shares.
- When filing ITR, reconcile your own records with the AIS and 26AS data, rather than depending solely on broker P&L reports.
- If the mismatch between Upstox P&L and your actual acquisition cost is significant, keep proper documentation (gift deed, transfer proof, allotment letter) in case of future scrutiny.
Please note that Upstox provides FIFO-based automated reporting, but it does not allow manual intervention for acquisition cost tagging on transferred/unlisted shares. For compliance and accuracy, your own record-keeping is critical. At the time of tax filing, you should use your actual acquisition values rather than the default zero-cost figures reflected in the broker’s P&L. Hope this helps.
Thanks for the detailed information.
I’m curious—why don’t platform updates include a feature to address this issue for reporting purposes? Why is there no provision for investors to submit complete details with supporting documents to update the acquisition cost with the broker?
I’ve noticed that Upstox and other brokers are heavily focused on integrating with third-party platforms, yet this core issue remains unresolved. It feels like no one is addressing this real, practical challenge faced by investors.
If any platform were to solve this problem effectively, I believe a significant number of users would consider switching. Just sharing a thought with you.
Thanks again.
Hi @SUNITA_31875847,
Any broker platform is tightly integrated with the depository (CDSL/NSDL). The cost of acquisition is not a field stored at the depository level, only quantity and ISIN are tracked. If brokers allowed investors to manually edit costs, it could open up compliance risks. For example, wrong or inflated costs might be input intentionally to reduce taxable gains. Brokers would then be indirectly responsible for misreporting.
Since tax computation is a personal responsibility (not the broker’s), the current stance across the industry has been to keep cost input “read-only” and leave accurate reporting to investors and their CAs. There is no uniform regulatory framework from SEBI/Income Tax that tells brokers, “You must allow investors to declare/update acquisition cost.”
Each investor’s case (IPO allotment, ESOP, gift, inheritance, off-market transfer, corporate action) is unique, which makes automation difficult. Hope this answers your query.