Clipped from: https://www.financialexpress.com/money/your-queries-on-income-tax-pay-tax-on-dividends-from-stocks-at-your-slab-rate-4179154/
Expert tax advice on navigating Indian income tax rules for 2026, including dividend taxation, interest penalties for missing the March 15 advance tax deadline, NRI rental income obligations, and the latest ULIP tax-exempt limits under Section 10(10D).
Tax Q&A: From Dividend Gains to Advance Tax Penalties—Your 2026 Compliance Guide
How do I pay tax on the dividend that I earned from stocks and bonds?—Gaurav Sharma
Dividend income from stocks and bonds is taxable in the hands of the taxpayer. This income is added to the total income and taxed as per the applicable income tax slab. In case dividend from a company exceeds Rs 5,000 in a year, 10% TDS may be deducted, and the taxpayer needs to report the full amount under “Income from Other Sources” while filing the return and claim credit for the TDS.
I could not pay advance tax before March 15. Can I pay it now without paying any interest or penalty?—Abhinav Mishra
As per the provisions of the section 234C of the act, any delay in payment of advance tax attracts interest at 1% per month (or part thereof). Since the instalment due on March 15 was not paid on time, interest at 1% will apply for one month on the amount of shortfall, even if the payment is made before March 31. Accordingly, it is therefore incorrect to state that paying now carries zero interest consequences in all cases. Besides that, as per section 234B of the act, if at least 90% of the total assessed tax liability (total tax liability minus TDS/TCS) is not paid by March 31, additional interest at 1% per month (or part thereof) will be levied from April 1 onwards until the assessed tax liability is fully paid.
My brother moved to Canada a year ago. We have a joint property which is on rent. Does he have to pay tax on his share of rent?—Ranadeep Pal Singh
Yes, he will generally have to pay tax on his share of the rental income in India. Since the property is located in India, the rent is taxable in India, even if he now lives in Canada. His share of the rent will be taxed in India after claiming the standard 30% deduction and municipal taxes (if any). As a non-resident, TDS may also apply on his portion of the rent under Section 195 of the Income-tax Act, 1961.
If I invest in unit-linked insurance plans (Ulips), will the entire proceeds be tax-exempt?—Hitesh Kumar
The maturity amount from a Ulip is tax-exempt only if certain conditions are met. If the annual premium is up to Rs 2.5 lakh (for policies issued on or after February 1, 2021) and the policy is not surrendered early, the proceeds are generally tax-free under Section 10(10D). However, if the annual premium exceeds Rs 2.5 lakh, the gains are taxable like equity mutual funds. Also, if the policyholder dies, the amount received by nominees is fully tax-exempt, regardless of premium size.
The writer is managing partner, AKM Global, a tax and consulting firm
Disclaimer: The views expressed are the author’s own and do not reflect the official policy or position of Financial Express.
aniltikotekar4sme.com 