Dividend Taxation for Indian Promoters

Episode Duration:
60 minutes.

Episode Background:
As you are aware, dividend is currently taxed in the hands of the shareholders – whereby Indian individuals can be subjected to tax at a rate as high as 43%! Therefore, almost half of the dividend earned will go out as tax, which can have an extremely undesirable impact in the future.

In the light of the current unprecedented circumstances, while industries across the country are grappling with recovery issues owing to the novel Coronavirus, a topic like “Dividend Taxation for Indian Promoters– Implications, Comparison and Strategies” may seem like a strange one at the outset. However, understanding dividend taxation and using the right strategies isn’t to immediately extract dividend from a company, but rather, to formulate strategies and implement them, so as to reap the benefits in times to come. Ironically, this may be the best time to execute such a strategy!

What will the episode cover?
This episode led by Milin Mehta (Managing Partner) and supported by Suril Mehta (Associate Director) from KCM, comprehensively discusses the myriad tax implications of the dividend taxation as applicable to the Indian promoters. Furthermore, the speakers have also discussed the following points w.r.t, (i) tax on dividend under various circumstances in the pre 31st March era, and as per the revised provisions. (ii) effective tax rate - including the tax paid by the foreign subsidiary, if any, the Indian company (DDT or otherwise), and the Indian promoters & (iii) evaluation of tax impact by having different entities, eventually giving rise to few strategies that can be considered to reduce the tax burden.