Earlier position
if co wants to distribute RS 100 as dividend , then co deducts 16.995 as DDT and pays Balance 83.005.
But now from 1.10.2014 (Due to amendment)
Grossing up is applicable . (Institure Journal - Aug 14 :- Total tax rate after applying gross up concept will be 20.47%).
Please solve the above example by applying the concent of gross up.
How to gross up and upon which figure the 20.47 % will be applied.
Thanks in advance.
where have you read this?? can you provide me the link?
| Originally posted by : Akanksha Jain | ||
 |
where have you read this?? can you provide me the link? |  |
https://220.227.161.86/34301cajournal-aug14-8.pdf
See Point No 3
Now, after amendment if a company wants to distribute Rs. 100 as dividend it will deduct Rs.16.995 (Rs. 100*16.995%) as tax and distribute Rs. 83.005 as dividend.
So. effective tax rate is 20.474% as Rs. 83.005*20.474% = Rs. 16.995
Therefore increase in tax is 3.479% (20.474 - 16.995)
Thanks a lot.
CAclubindia
