Quick Summary
The Finance Bill, 2020 proposed to remove Dividend Distribution Tax (DDT) at the level of Company/ Mutual Fund and proposed to tax the same in the hands of share/unit holder. It was also proposed to levy TDS at the rate of 10% on the dividend/ income paid by the Company/Mutual Fund to its share/uni
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FAQ :
The Finance Bill 2020 proposed to remove Dividend Distribution Tax (DDT) at the company/mutual fund level and instead tax it in the hands of the share/unit holder.
A TDS at the rate of 10% is proposed on dividend/income paid by a company/mutual fund if the amount exceeds five thousand rupees in a Financial Year.
No, the CBDT has clarified that mutual funds are not required to deduct TDS on income that is in the nature of capital gains arising on redemption of units.
Mutual funds are required to deduct TDS at 10% only on dividend payments made to their unit holders.
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