Fund drawn by director

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pradip roy (Querist)
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23 September 2010 Our company is Pvt. Ltd. both directors are familiy member.

Now my question is, if director borrow funds except than their remuneration fixed, will it attracts dividend tax. If yes what would be the rate of tax.

Please advice us asap.

Aditya Maheshwari

Aditya Maheshwari (Expert)
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23 September 2010 Deemed dividend u/s 2(22)(e) liable if the company is having reserves. TDS dedductible u/s 194 and taxable in the hands of the shareholder at the slab rate applicable.

pradip roy

pradip roy (Querist)
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23 September 2010 Thanks Aditya

Here it is directors own company...80% share on his name + 20% share on his mother name.

Total fund drawn Rs.67 lacs.

Pls. advice rate of tax applicable here

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