Ddt

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Shubham Rohatgi (Querist)
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20 May 2014 Doesn't Dividend Distribution Tax amounts to double taxation?
A Company firstly pays tax on its earnings @ 30.90% and when a part of earning is distributed as dividend then DDT is also to be paid. So here the amount involved for dividend is facing double taxation.

Nikhil Kaushik

Nikhil Kaushik (Expert)
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20 May 2014 no it doesn't as on account of DDT, the said dividend income is exempted in the hands of receiver.

Shubham Rohatgi

Shubham Rohatgi (Querist)
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20 May 2014 but then company has to pay tax twice on the same amount, it probably does amounts to double taxation.

Nikhil Kaushik

Nikhil Kaushik (Expert)
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20 May 2014 Ddt is paid only on the dividend amount...and since the shareholder is.not required to pay tax on the same, there is no double impact. The whole idea of ddt is to conveniently collect taxes.

Shubham Rohatgi

Shubham Rohatgi (Querist)
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20 May 2014 Not from the shareholder's view but look for company as a person. It is paying tax firstly on its earnings and then on the amount of dividend which is already been taxed with earnings.

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