04 July 2024
My brother has an NRI status and has received dividends from HDFC Mutual Fund for Rs 6531 u/s 196A and TDS @ 20.8%+ is deducted and deposited as per 26AS. As per my understanding this amount needs to be entered either in Sch - Other Sources (OS) or in sub-section 115A(1)(a)(i)- Dividends in case of non-residents under Schedule -SI (Income Chargeable at Special Rate). But in the AIS Summary the amount is shown in Schedule -SI (Special income) under 'Income received in respect of units of UTI purchased in Foreign Currency u/s 115A(1)(a)(iii)' which is leading to tax liability of Rs 1359 i.e., equivalent to 20.8% of dividend income. My brother has total taxable income ( from dividend and saving bank interest) of Rs. 120,000 during the FY 2023-24 hence accordingly he should be eligible for full TDS refund but in this case his refund amount is getting reduced by the tax liability of Rs. 1359 occurred due to mutual fund dividend income reported under u/s 115A(1)(a)(iii) of Schedule -SI. Please advise the correct way of reporting this particular income in ITR. Thanks for your time and help.
04 July 2024
Thanks for your prompt reply and kind guidance, really appreciate your help. Just for your information these units were purchased through NRO account and as advised I have raised this concern with MF house. Let's see when they respond. One last this to clarify, if MF house rectify the data then where it will appear in AIS and can we claim full refund of the TDS deducted on this dividend income. Thanks again
CAclubindia
