Section 194 - TDS on Dividend - Income Tax - Ready Reckoner - Income Tax

Section 194 : TDS ON DIVIDEND Applicability The principal officer of an Indian company or a company which has made the prescribed arrangements for the declaration and payment of dividends (including dividends on preference shares) within India, shall, who is resident in India, of any dividend within the meaning of sub-clause ( a )/( b )/( c )/( d )/( e )/ [(f) inserted vide Finance (No. 2)Act, 2024 ] of clause ( 22 ) of section 2, deduct from the amount of such dividend, Rate of TDS - 10% Time of Deduction - Before making any payment by any mode in respect of any dividend or before making any distribution or payment to a shareholder, whichever is earlier Exception of this section No such deduction shall be made if the dividend is paid by any mode other than cash and the amount of such dividend does not exceed Rs. 5000/-. Lower TDS Certificate:- A Shareholder may apply in form No. 13 to the concerned Assessing Officer and obtain a certificate authorising the payer to pay dividend without tax deduction or with deduction at lower rate. No TDS if dividend is paid or credited to an insurance company:- The provisions of this section shall not apply to such income credited or paid to LIC, General Insurance Corporation of India and any other insurer in respect of any shares owned by it or in which it has full beneficial interest Declaration in Form 15G/15H:- Tax is not deducted if the recipient furnished a declaration in form No. 15G( in the case of senior citizen Form No. 15H), to the payer of dividend to the effect that the tax on his total income will be Nil. No deduction of income tax shall be made under section 194 of the Income-tax Act from any income in the nature of dividend paid by any unit of an International Financial Services Centre, primarily engaged in the business of leasing of an aircraft (hereinafter referred as payer) to a company, being a Unit of an International Financial Services Centre primarily engaged in the business of leasing of an aircraft (hereinafter referred as payee) subject to the fulfill specified conditions [ Notification No. 52/2023 Dated 20.07.2023 ] No TDS if paid or credit by special purpose vehicle to business trust w.e.f 01.04.2020. w.e.f. 01.04.2024, No deduction of tax shall be made under the provisions of section 194, payment made by any payer to a person being a Unit of International Financial Services Centre in respect of following services Broker Dealer/ Finance Company/ Finance Unit Dividend Income [ Notification No. 28/2024 dated 07.03.2024 ]