Reduction in Dividend Distribution Tax [Sec. 115-O(1A)] - Income Tax - Ready Reckoner - Income Tax

SEC 115-O(1A) : REDUCTION IN DIVIDEND DISTRIBUTION TAX CASE-1:HOLDING-SUBSIDIARY If any domestic holding company receives during the financial year any dividend from its domestic subsidiary company on which the subsidiary company has paid DDT if payable under section 115-O , if any or any dividend from its foreign subsidiary company on which the tax is payable by holding company under section 115BBD , then, such dividend shall be reduced from the dividend declared / paid/ distributed by the domestic holding company during the financial year. Note: Holding company should hold more than 50% of equity share capital of domestic subsidiary company and foreign subsidiary company. Provided that the same amount of dividend shall not be taken into account for reduction more than once. CASE-2: DIVIDEND PAID TO NPS The amount of dividend, paid to any person for, or on behalf of, the New Pension System Trust shall be reduced from the dividend referred to in section 115O(1) . NOTE:- Subsidiary company means only that subsidiary company in which parent company hold more than 50% in nominal value of equity share capital. Dividend received from other type of subsidiaries i.e., subsidiaries having Controlling Composition of Board, sub-subsidiaries, joint ventures, etc. shall qualify for availing benefit under section 115-O (1A) .