Bonus Issue of Shares
Capitalising reserves into fully paid bonus shares under Section 63
- 1CheckReserves and Section 63 conditions verified.
- 2ApproveBoard recommendation and shareholder approval.
- 3AllotBonus shares allotted; PAS-3 filed.
Share your details. We’ll reply on WhatsApp with the next steps and a checklist.
Pick a plan — the fee is adjusted if you hire us within 30 days.
About Bonus Issue of Shares
A clear overview, in simple terms — what it is, why it matters, and how we handle it.
A company can issue fully paid bonus shares to existing shareholders out of free reserves, the securities premium account or the capital redemption reserve under Section 63, if its articles authorise it, the board recommends it and shareholders approve it in a general meeting. Bonus shares cannot be issued in lieu of dividend or out of revaluation reserves, and the company must not be in default on deposits, statutory dues or employee dues.
A bonus issue rewards shareholders without cash leaving the company and often brings the share count in line before a fundraise or ESOP grant. The authorised capital must be sufficient; if not, it is increased first.
For shareholders, bonus shares have nil cost for capital gains; the holding period starts on allotment.
We check the reserves, the conditions in Section 63, draft the approvals, file PAS-3 within 30 days and update the registers.
| Sources | Free reserves, securities premium, capital redemption reserve |
|---|---|
| Not from | Revaluation reserves; not in lieu of dividend |
| Approvals | Articles authority, board recommendation, general meeting |
| Filing | PAS-3 within 30 days |
| Tax cost of bonus shares | Nil for capital gains |
Who this is for
Common scenarios where this service is a good fit.
- Companies with accumulated reserves
- Startups adjusting share count before a round or ESOP pool
- Companies rewarding long-standing shareholders without paying out cash
What you get
Clear deliverables so you know exactly what's included.
- Eligibility check under Section 63
- Authorised capital check and increase if needed
- Resolutions and PAS-3
- Register and cap table update
Expert review before every submission — not just data entry.
Working notes and reconciliations you can rely on in future notices.
Resident Indians, NRIs, expats and cross-border businesses — all served.
Documents required
A practical checklist. We'll tell you if anything else is needed based on your case.
* This is a base checklist. After a quick pre-check, we may ask for additional items specific to your case.
Process
A simple, trackable workflow — designed to avoid back-and-forth.
Reserves and Section 63 conditions verified.
Board recommendation and shareholder approval.
Bonus shares allotted; PAS-3 filed.
Get a quote
We share a clear quote on WhatsApp after a quick checklist pre-check.
- Fixed quote on WhatsApp after a short look at your facts and documents.
- Government fees, if any, are paid at actuals and shown separately.
| Factor | DIY | Indus Tax |
|---|---|---|
| Expert review | ❌ | ✅ |
| Notice risk reduction | ❌ | ✅ |
| Deduction optimisation | ❌ | ✅ |
| Audit-ready records | ❌ | ✅ |
| AIS/26AS reconciliation | ❌ | ✅ |
Share your facts and deadline. We'll reply with the right checklist and a clear quote.
Fee adjusted against our service fee if you go ahead within 30 days.
- Priority CA Call-backSkip the queue — a CA calls you within 30 minutes.₹255
- RecommendedCA Consultation (30 min)Talk one matter through properly with a CA.₹755
- In-depth CA Review (60 min)Documents reviewed before the call, written action plan after.₹1,155
Call-backs run Mon–Sat, 9 AM–6 PM IST. Booked outside these hours? We call you first thing the next working morning.
Compare the 3 plansFrequently asked questions
Answers to the most common questions we get.
Official sources
Indus Tax is a private professional services firm and is not affiliated with any government authority. Rules and fees change — we confirm current positions before filing.
