Question

when to use pre tax kd and when to use post tax kd

Answer 1

You should be consistent with the calculations, if your cash flow is taking in to account the tax shield, you need to use the pre tax kd, if not you have to use the after tax. Normally people do it with the after tax Kd.
keep in mind that you should include the effect of the tax shield once, if you see that you are including it more than once, there is something wrong...

Answer 2

could you elaborate with an example?

Answer 3

Agree with Jmpyco,
always remember FOR WHOM you are calculating and how much is the requirement/ rate required to be earned to satisfy the expectation
for valuing debt for CPMPANY kd post tax used because company not required to earn upto coupon amount but coupon - tax (tax saved)
and say you are valuing for DEBENTURE HOLDER use market interest rate which is debt coupon rate (assumed) so coupon rate will be discount i.e.before tax rate
please senior correct, if wrong anywhere