What are dividends and how are they taxed?

Income Tax
21

Hi @praveen_dwibhashi

As said above by @Muskan_Balar that the total income (₹10,33,026) is just shown on the user interface as taxable income.

For the purpose of tax calculation, the salary income and IFOS are taxed at the normal slab rate, whereas LTCG and STCG are taxed at a special rate.
That means, since LTCG is less than ₹1,00,000 (₹15,638) it is not taxed.
STCG is taxed at a flat rate of 15%, ie, ₹2989 * 15% = 448

Salary and IFOS = 10,07,636 + 6763 = 10,14, 399
Less: Deductions = 2,32,633
Taxable income = 7,81,766
Tax payable = 12,500 + 56,353 = 68,853
Total tax payable = 448 + 68,853 + 4% Cess = 72,073

You can view & download the tax computation report for better understanding.

Hope this helps.

22

Hi, thanks for the clarification.

But why did you add dividend income to my final taxable income. I think for 5000 there is no tax that I need to pay and the remaining 1763 should be taxable. In that case you can see my previous calculation the tax I need to pay is only 68,300+4% CESS (2732) = 71033. But in quicko it is showing 69301+4%CESS (2772) = 72073. Which is 1k more than the tax that I need to pay.

23

Hi @praveen_dwibhashi

Dividend income is taxable at the slab rate.
The limit of ₹5000 is for TDS to be deducted from dividends from a domestic company.

Hence, the entire dividend of ₹6763 is taken into consideration and the total tax payable (₹72,073) shown by Quicko is correct.

Hope this clarifies.

24

Why is the entire dividend amount considered for tax? there is an exception for Rs.5000/- for dividends right.? In that case, I need to pay only tax for Rs.1763/- i.e., Rs.352.6/-.

Because there are no deductions happened at any of the company.

25

Hi Praveen,

The limit of ₹5000 on dividends is for the TDS applicability.
A 10% TDS is payable on the dividend income of over ₹5,000 during the financial year.

Dividend income of any amount is taxable in the hands of the receiver at the applicable slab rate.

1 Like
26

Hi

The dividend income shown in AIS and in my bank statement doesn’t match , AIS is showing in higher side and secondly dividend credited during a particular financial year will be consider as the dividend income for that financial year or there is something else to this.

27

Hi @Rout

You can first compare the dividend income in your AIS & Form 26AS.

If that doesn’t match, you can rely on the dividend income received (credited) in your bank account.

28

Hi Muskan,
Could you pls recheck on the eligibility of taxation on income distributed by Mindspace and Embassy Reits. Both mentions that they havent opted for lower tax regime and hence dividend income isnt taxable.

Regards,
Shweta

29

@CA_Niyati_Mistry if you can help here

30

Hi @Shweta_Agrawal,

Since both the Mindspace and Embassy REITs have not opted for lower tax regime, the dividend income received from the same shall be exempt.

Hope this clarifies!

31

Thanks Niyati!

How could we show this in ITR 2? Where we can claim exemption. Request guidance.

Regards,
Shweta

32

Hello @Shweta_Agrawal,

You can show it as Other Exempt income while filing ITR-2.

Hope this helps!

33

Hi i do have received dividend from us… Iam resident in india

What is the tax treatement here and where to show and how to use dTTA

34

Hi @venky_venkatesh

Dividend income from U.S. will be added to ‘Income of Other sources’ and taxed according to the individual’s tax slab rate.
Any tax deductions can be claimed as credits according to the DTAA provisions. Read about DTAA between India and USA - Learn by Quicko.

To claim any foreign tax credits you will need to file form 67.

35

HI @Shrutika_Shah
I filed iTR3 and while Submitting ITR, can see error detected msg. when i downloaded report, can see below message.

[{“error_code”:“EF0000”,“message”:“Invalid payload”}]

36

Hi @Sunil_Kumary

Can you please Submit a ticket : Help Center so that our team can get in touch with you and help you accordingly?

37

Hi,
Same error code for me too. I have raised a ticket on QUICKO.

38

Hi

I have a couple of question on the INVIT which please clarify:

  1. Is the TDS applicable for the unitholders at 10% subject to the limit beyond Rs.5,000/- as is applicable for equities and debt instruments where dividends and interests are paid respectively?
  2. The tax exemption component of Dividend and the treasury income are exempted merely from TDS or is it exempt from the tax obligation of the assessee?
39

Hey @gdshan

Apologies for the delay in responding.

Here is the answer to your queries:

  1. Yes, TDS is required to be deducted by the INVIT on the dividend payments made to unitholders @10%.
  2. The exemption is for both TDS and tax obligations.