dividend distribution tax

dear rachit

company will liable to pay tax at the rate of 16.995%.bcoz company continue to be liable to pay surcharge if his total income exceeds 1crore according to finance act2009

Dear Rachit,

For Dividend Tax Purposes, the year to which it pertains is not relevant. It is a current item & hence rate prevailing at the earliest of the event shall be applicable -

 (a)   declaration of any dividend; or

 (b)   distribution of any dividend; or

 (c)   payment of any dividend,

hi

DDT @ 16.995% 

15%+1.5% of surcharge +3% cess

and  also make the provision for general Reserve not exceeding 10% of profit 

dear aditya sir

div. dis tax rate how can be 16.60875%.bcoz the com. makes declaration in f/y 2009-10 itself.

See Tarun dividend is to be distributed though for F. Y. 2009 - 10 the declaration for the same will  be in June 2010 probably in the AGM and hence the rate of surcharge applicable at that date would be 7.5% the rate prevailing at that time.

Also if you remember the rates of DDT was changed w. e. f. 01.04.2007 from 12 to 15 % and all the companies which declared dividend in the AGM though for F. Y. 2006 - 07 paid DDT @ 15% and not 10%