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Dividend distribution tax

Amrutha KM (30 Points)

19 September 2019

What is the rate for Dividend distribution tax for the assessment year 2019-20?

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13 Replies

sabyasachi mukherjee (27117 Points)
Replied 19 September 2019

Finance bill 2019 there sre certain alterations.

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Amrutha KM (30 Points)
Replied 19 September 2019

What are the alterations?

Kapadia Pravin (17254 Points)
Replied 19 September 2019

@ Amrutha

DDT by domestic company

15% on gross dividend under section 115O
Effective rate is 17.65% on dividend amount

Add 12% surcharge & then add 4% cess

The final effective rate is 20.56%

sabyasachi mukherjee (27117 Points)
Replied 19 September 2019

Amrutha only changes
if the dividend rwxeived is in excess of rs.10 lakhs then 10% ddt is applicable from AY 20-21.

Suresh Thiyagarajan (Student) (3986 Points)
Replied 19 September 2019

1. Plainly apply 20.56% on the amount of dividend declared. If any amount is received as a dividend on which DDT is already paid then the same should be deducted from your dividend and the balance will be taxable u/s 115-O.
Please correct me if the above solution has an alternative view.

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sabyasachi mukherjee (27117 Points)
Replied 19 September 2019

Mr.suresh the threshold limit is only Rs.10 lakhs for individual from AY 20-21.....

Kapadia Pravin (17254 Points)
Replied 20 September 2019

@ Amrutha
Your query is for DDT. For that you referred my earlier reply.

There are no changes / amendments in Finance Bill 2019. NO CHANGES such as > 10 lakhs , 10% DDT in Finance Bill 2019. Don't get confused.

Under 115BBDA individual who receives aggregate dividend (on which DDT is paid by companies) in excess of 10 lakhs has to pay 10% tax on dividend amount in excess of 10 lakhs.

This provision is effective since AY 2017-2018.

sabyasachi mukherjee (27117 Points)
Replied 20 September 2019

@ kapadia
I told u earlier do not get excited
its from previous year 2017-18
but Ay 2018-19.
though introduced but there were lot of confusions among corporate and other equity shareholders resulting into mismatch .
So finally from AY 2020-21
it is revised and it is broadened.
Today also there are lot of rare cuts in the corporate sector.

Kapadia Pravin (17254 Points)
Replied 20 September 2019

Mr. Sabyasachi - This is introduced by Finance Act 2016 and effective from AY 2017-2018. (115BBDA)

The facts are in Act.

What confusions among corporate and other equity shareholders ? pl inform.
Resulting into mis-match what ?
What is revised finally and what is broadened - from AY 2020-21.

This 10% Tax on > 10 lakhs is not DDT but it's

"Tax on certain dividends received from domestic companies." vide 115BBD

I request you to inform for knowledge update .
Regards.