What is section 115O?

(1) Notwithstanding anything contained in any other provision of this Act and subject to the provisions of this section, in addition to the income-tax chargeable in respect of the total income of a domestic company for any assessment year, any amount declared, distributed or paid by such company by way of dividends ( …

How do you calculate dividend DDT?

How is Dividend Distribution Tax Calculated?

1. For instance, Dividend distributed is 100.
2. Grossing up of dividend [100/85*100] = 117.65 DDT @ 15% on 117.65=17.65.
3. Surcharge @ 10%=1.76.
4. Education cess @ 3%=0.58.
5. Effective tax rate of 19.994% on INR100.

What is DDT in income-tax?

Dividend Distribution Tax (DDT) is a tax levied on dividends distributed by companies out of their profits among their shareholders. The Dividend Distribution Tax is taxable at source and is deducted at the time of the distribution. According to the law, DDT is levied at the hands of the firm, and the shareholder.

Is DDT still applicable?

Amendment made by Finance Act 2020- Abolition of DDT for Indian Companies. Up to Assessment Year 2020-21, if a shareholder gets a dividend from a domestic company, it is exempt in the hands of the shareholder. However, the Finance Act 2020 has introduced abolition of DDT for the companies.

What is Section 72A of Income Tax Act?

Section 72A of the Income-Tax Act, 1961, contains provisions relating to carry-forward and set-off of accumulated loss and unabsorbed depreciation allowance in case of re-organisation of business by way of amalgamation or demerger, etc.

Is dividend tax free?

As per existing tax provisions, income from dividends is tax free in the hands of the investor up to Rs 10,00,000 and beyond than tax is levied @10 percent beyond Rs 10,00,000. From 2016, the investors (resident in India) earning dividends above 10 lakhs per annum will have to pay an additional tax of 10%.

How much amount of dividend is tax free?

As per existing tax provisions, income from dividends is tax free in the hands of the investor up to Rs 10,00,000 and beyond than tax is levied @10 percent beyond Rs 10,00,000. Further the dividends from domestic companies are tax-exempt, dividend from foreign companies are taxable in hands of investor.

What is the tax on dividend income?

Dividends are paid out of profits which have already been subject to Australian company tax which is currently 30% (or 27.5% for small companies).

Is DDT still used in India?

India is the only country still manufacturing the pesticide dichlorodiphenyltrichloroethane, better known at DDT. China ceased production of the chemical in 2007. Public sector firm Hindustan Insecticide Limited (HIL) is the only producer of DDT in India.

What are the tax benefits available to an amalgamating company?

o Exemption from Capital Gains Tax [Sec. 47(vi)] Under section 47(vi) of the Income-tax Act, capital gain arising from the transfer of assets by the amalgamating companies to the Indian Amalgamated Company is exempt from tax as such transfer will not be regarded as a transfer for the purpose of Capital Gain.

What does 115-o mean for income tax?

115-O. (1) Notwithstanding anything contained in any other provision of this Act and subject to the provisions of this section, in addition to the income-tax chargeable in respect of the total income of a domestic company for any assessment year, any amount declared, distributed or paid by such company by way of dividends…

When does section 115-o of Income Tax Act 1961 become effective?

Today, we learn the provisions of section 115-O of Income-tax Act 1961. The amended provision of section 115-O is effective for financial year 2020-21 relevant to the assessment year 2021-22.

What are the provisions of the Income Tax Act 1961?

Chapter XIID (Sections 115-O to 115Q) of the Income Tax Act 1961 deals with the provisions related to special provisions relating to tax on distributed profits of domestic companies. Section 115P of IT Act 1961-2020 provides for Interest payable for non-payment of tax by domestic companies.

What is the tax on accreted Income Act?

Section 115TD of IT Act 1961-2020 provides for tax on accreted income. Recently, we have discussed in detail section 115TC (Securitisation trust to be assessee in default) of IT Act 1961.