TDS limit on dividend: good news for investors! TDS limit on dividend income
The Narendra Modi government has announced a proposal to increase the tax exemption (TDS) limit from Rs 5,000 to Rs 10,000 in the Union Budget 2025-26 in 2025-26. The decision was taken as part of the rationalization of the TDS border. This action gives the stock market an incentive to mutual fund investors. This is because it reduces the burden by doing something to them.
The Union Budget has increased the TDS limit on dividend income by Rs 2025 shares and mutual funds from Rs 5,000 to Rs 10,000. The dividend income of investors from a stock or mutual funds is more than Rs 10,000 a year. However, Optima Money Manager MD and CEO Pankaj Matpal should remember that this limit is not only on dividend income from stock or mutual funds, not on total dividend income from an investor to an investor. Let’s understand dividend income by an example of TDS border
For example ..
- If an investor earns a dividend income of Rs 9,000 per year from a specific stock, then according to the new proposed TDS limits, he will not exclude any amount from the amount received. According to the old limit, the company deposits Rs 8,100 in an investor’s account, except for TDS@10 % in dividend income of Rs.
- Another investor ‘B’ receives a dividend of Rs 11,000 from a company, while the new proposal will come down to 10 percent, or Rs 1,100. Therefore, Rs 9,900 will be deposited in the investor account.