Dividend & tax implications

This is a private limited company. We have decided to pay interim dividend to Directors. How much % of Dividend distribution tax is payable and how the tax should be paid? What is the due date of paying Dividend distribution tax.

Please help us on this.

 

Replies (1)

DDT( Dividend Distribution Tax U/s.115O) is @ 16.995% payable on Proposed Dividend. i.e for e.g. if Dividend Propsed is 1,00,000 then 16.995% on above i.e 1,00,000 X 16.995% = 16,995 and pay 1,00,000 - 16,995 = 83,005 as Dividend to share holders. If you pay entire amount i.e 1,00,000 as divident to share holders and paid 16,995 to dept. as DDT then you will not eligible to claim such DDT paid u/s.115O as expense in profit and loss account. So the regular practice in Industry is to pay Dividend of Rs.83,005. so pay dividend of rs.83,005 to share holders and 16,995 to department.Hope you gain from my post.

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