Income Tax

Applicability of TDS provisions on Mutual Fund dividend. CBDT issues clarification 

Applicability of TDS provisions on Mutual Fund dividend. No deduction on income in the nature of capital gains-CBDT issues clarification 

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/unit holder if the amount of such dividend/ income exceeds five thousand rupees in a Financial Year.

Queries have been received to the effect that whether under the proposed section 194K, the Mutual Fund would be required to deduct TDS also on the capital gains arising on redemption of units.

It is hereby clarified that under the proposed section, a Mutual Fund shall be required to deduct TDS @ 10% only on dividend payment and no tax shall be required to be deducted by the Mutual Fund on income which is in the nature of capital gains. Necessary clarification, if required, shall be proposed in the relevant provision of the law.

Share

Recent Posts

  • Government

Temporarily blocking public access to Telegram App not disproportionate – Delhi High Court

Temporarily blocking public access to Telegram App under section 69A of IT Act 2000 is not disproportionate - Delhi HC…

2 days ago
  • Income Tax

High Court explains the meaning of term ‘enterprise’ appearing in section 80IA

High Court explains the meaning of term ‘enterprise’ appearing in section 80IA to means a project or an undertaking owned…

2 days ago
  • Income Tax

Addition deleted as assessee was only a carrier of cash not owner who came up to own it

Addition deleted as assessee was only a carrier of cash and the real owner had come forward owning the cash…

4 days ago
  • RTI

Lokayukta Police not exempt from disclosure of information under RTI Act 2005 – SC

Lokayukta Police not an ‘intelligence and security’ organisation  and hence not exempt from disclosure of information under RTI Act 2005…

6 days ago
  • Income Tax

Payment of imprest whether a transfer within the meaning of section 269ST

Payment of imprest whether a transfer within the meaning of section 269ST – case remanded for determination In a recent…

1 week ago
  • ICAI

CA Misconduct – Order quashed as judgment not passed by same members who heard arguments.

CA Misconduct – Appellate order quashed as final judgment was not passed by same members who heard arguments. In a…

1 week ago