I’ve learn that dividend earnings can be pre-filled within the IT type this 12 months. How can I cross-check whether or not the pre-filled quantity is appropriate or not? From the place can I get the main points of the dividend earnings I’ve obtained previously one 12 months, and what would be the fee of tax that I’ve to pay every quarter on the divided earnings earned?
—Name withheld on request
We have assumed that you’re a resident of India and dividends obtained are from Indian corporations. The finance minister in her Union Budget 2021 speech introduced that to ease compliance for the taxpayer, amongst different incomes, particulars of dividend earnings will even be pre-filled within the earnings tax return utility.
The precise mechanics and the extent of particulars pre-filled within the utility by the tax division stays to be seen and could also be out there sooner or later.
Generally, each firm paying dividend in extra of ₹5,000 to a resident taxpayer is required to withhold taxes from such dividend on the fee of 10% and file a withholding tax return on this regard. Once the stated withholding tax return is filed by the respective firm(ies), the main points of such dividends are mirrored within the investor’s Form 26AS. Hence, in relation to pre-filled dividend data within the tax utility, from a sensible perspective, you may anticipate that solely such dividend incomes which have been reported by respective corporations of their withholding tax returns (WTR) could get pre-filled in your tax submitting utility.
In any case, even the place the knowledge is pre-filled within the utility, it’s advisable that the taxpayer ought to cross examine the pre-filled data from his/her dividend statements. You can get hold of the main points of the dividends paid to you out of your dealer or portfolio supervisor who could situation the dividend statements to you for the respective interval. You also can examine the main points of the dividend out of your financial institution statements the place such dividends are credited. The firm declaring the dividend would additionally ship you a communication on this regard.
The dividend earnings shall be topic to tax in your arms on the relevant slab charges (plus relevant surcharge, if any, and training cess). It could also be famous that most relevant surcharge on dividend earnings is 15%.
Parizad Sirwalla is companion and head, world mobility providers, tax, KPMG in India.
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