Corporate dividend tax

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lavanya (Querist)
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16 August 2014 What is corporate dividend tax, and what is deemed dividend?
Please explain me the tax impact in both cases.
Thank you

Nikhil Kaushik

Nikhil Kaushik (Expert)
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16 August 2014 corporate dividend tax (dividend distribution tax) is the tax charged under section 115-O of the Income-tax Act. This tax is paid by the Company itself.

For definition of dividend please refer section 2(22) of the Income-tax Act. Section 2(22)(e) deals with deemed dividend. The tax on deemed dividend is borne by the recipient.

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lavanya

lavanya (Querist)
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17 August 2014 Can u please explain the difference between corporate dividend tax and tax on deemed dividend.. Y tax on deemed dividend is borne by the recipient and not the company?

Nikhil Kaushik

Nikhil Kaushik (Expert)
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17 August 2014 because deemed dividend is not declared by the company. Deemed dividend is a deeming provision of income-tax act and has nothing to with the company.

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