An ESOP that motivates is one employees understand and lawyers cannot poke through: a scheme approved the right way, grants papered person-by-person, a register that reconciles to the cap table, and tax events computed before they surprise payroll. Implementation is where good intentions become enforceable options.
| Item | Position |
|---|---|
| Approval | Companies Act route: special resolution; private-company relaxations as applicable |
| Vesting | Minimum one-year cliff under the rules; schedules are design choices after that |
| Tax | Perquisite at exercise, capital gains at sale — computed per event |
| Register | Grants, vesting, exercises and lapses tracked continuously |
The scheme document, resolutions and filings, grant letter templates and executed letters, the ESOP register, and the employee FAQ pack.
Cap table, board/shareholder details, list of proposed grantees with grant sizes, and the company's hiring/retention intent for design.
Design choices (who gets what, on what vesting) are the founders'; the engagement makes them legal, recorded and administrable. Promised-but-unpapered history must be disclosed to be cured.
Trust-route ESOP structures and listed-company SEBI regimes are outside this scope; valuation reports are issued under the valuation engagement.
Pool of what size?
A design question answered against your hiring plan and the round's expectations — typical early-stage pools run high single digits to mid-teens percent, but the right answer is the one your plan justifies, not the fashion.
Can we grant to consultants and advisors?
The statutory ESOP route is employee/director-centric with exclusions (notably promoters in most private setups); advisor arrangements often need different instruments. The design step maps who can legally get what.
What happens when someone leaves?
Whatever the scheme says — which is why leaver clauses (good/bad leaver, exercise windows, lapse) are drafted deliberately now, not litigated later.
When do employees actually pay tax?
At exercise (perquisite through payroll) and again on sale (capital gains) — with a deferral regime available to eligible startups. Each event is computed before it lands.
The applicable scope, documentation, professional responsibilities and timelines are agreed in an engagement letter before commencement.
ESOP ValuationCap Table ManagementAllotment & ROC FilingsRequest a Scope DiscussionThis page describes the service in general terms as on 6 August 2026 and is not professional advice or an assurance of any outcome. Registrations, filings, refunds and departmental outcomes depend on facts and the concerned authority. Figures and due dates change; verify current positions before acting.
| Compliance | Due | Note |
|---|---|---|
| FLA return (RBI) | 15 July (annual) | All entities with FDI/ODI on books |
| FC-GPR | 30 days from allotment | For fresh foreign investment |
| Valuation report (Rule 11UA / FEMA) | Before issue price is fixed | Method and valuer depend on route |
| ESOP: board/valuation/PAS-3 chain | Event-based | Perquisite TDS on exercise |
| DPIIT recognition | Anytime (before benefits) | Needed for 80-IAC and angel-tax relief |
Dates as generally applicable on 15 July 2026; extensions/notifications can change them — confirm current dates before relying.
Pool, vesting and leaver rules decided with founders.
Board/EGM resolutions passed and filed.
Letters issued and accepted; register opened.
Vesting tracked; exercises and taxes computed as they come.
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