Why is the dividend amount received is lesser than what it should be?

• The Dividend amount received may be lesser than expected due to application of (TDS)Tax Deducted at Source on Dividends declared on equity shares and mutual funds.
  
  
• TDS Rate On Dividends:

The different rates of TDS in different scenarios are as below given information: -

• TDS rates for the individuals are as given below : -
• For resident individual who have submitted their valid PAN with RTA : 
• There will be no TDS if the dividend amount is up to ₹ 5,000. 
• TDS at the rate of 10% will be applicable if dividend is greater than ₹ 5,000. 
• If form 15G or 15H is filed with the RTA of the company issuing dividends, TDS is deducted at a lower/NIL rate.
• For resident individual who have not submitted their valid PAN with RTA : 
• TDS of 20% will be applicable If the registrar (RTA) of the company doesn't have the PAN details of the investor in its records.
• TDS rates for the non – individuals (as company, partnership firm) are as given below 
• If valid PAN is deposited with RTA : TDS @10% on the entire dividend income.
• If valid PAN is not deposited with RTA : TDS will be applicable @ 20 % on the entire dividend income.
• TDS of 20% will be applicable for all non-resident shareholders.

 RELATED FACT: 

• The TDS paid on dividends is part of the tax paid for the financial year. This can be verified in the form 26AS, available on the income tax portal.