TDS on Dividend Payment

Getting emails for TDS on Dividend Payment from companies (Holding Shares in Portfolio). Like
"For Resident Shareholders, tax shall be deducted at source under Section 194 of the Income tax Act, 1961 at 7.5% on the amount of Dividend declared and paid by the company during FY 2020-21 provided PAN is provided by the shareholder. If PAN is not submitted, TDS would be deducted @ 20% as per Section 206AA of the Income Tax Act, 1961.

However, no TDS shall be deducted on the Dividend payable to a resident Individual if the total dividend to be received by them during FY 2020-21 does not exceed Rs 5,000. Please note that this includes the future dividends if any which may be declared by the Board in the financial year 2020-21."

Now each company is asking to submit Form 15G which is tedious.
Can’t we submit a single Form to declare these details?
is there any online process to submit the Form once in a year?
Please Guide.

Option:2
if we allow companies to deduct TDS and then can we take rebate/Claim while filing ITR…?

1 Like

@Quicko

Form 15G can be downloaded from the income tax website. It has the option to submit the details of multiple incomes together under the tab Income Details. You can add details of all your incomes and file the form on income tax website.

Yes. You can claim the TDS Credit when you file the Income Tax Return. If the TDS Credit is more than the tax liability, you can claim a refund of the excess TDS.

If you have received an email for deduction of TDS on dividend - Here is a blog for TDS on Dividend paid in FY 2020-21

For any further queries, write to us on [email protected]

(1)

An individual is eligible for tax rebate refund of a maximum up to Rs 12, 500 under section 87A if the taxable income does not exceed Rs 5 lakh in the financial year.

My question is : why upto 12500 only . What happens to the excess deductions ? Even though the taxable income does not exceed Rs 5 lakh in the financial year

(2)

The 10% TDS tax will be deducted from the dividend at the time of payment by the company to the mutual fund house .

AND the mutual fund house will also deduct the 10% TDS tax will be deducted from the dividend at the time of payment by the mutual fund house to the individual investor .

My question is :

In this scenario; the individual investor would be paying double tax i.e. directly 10 % fund house and that indirect 10% which the company deducted while paying to the mutual fund !!

So can the individual investors claim 20% rebate ?

Can u pls clarify the above 2 questions?

A taxpayer can claim deductions under Chapter VI-A of the Income Tax Act. He/she can also claim rebate of INR 12500 if the Total Income is up to INR 5 lacs.
You can read more about it here - Income Tax Slab Rates

TDS is required to be deducted at 10% under Section 194 or Section 194K if dividend exceeds INR 5,000 in the financial year. You can read more about it here
Section 194 : TDS on Dividend from Equity Shares
Section 194K : TDS on Dividend from Mutual Funds

For any further questions, write to us on [email protected]