Dividends received from stock investments are taxable in India. These dividends are included in your total income and taxed as per your applicable income tax rate. If your total dividend income exceeds ₹5,000 in a financial year, the company deducts 10% TDS before paying the dividends. However, if your income is below the taxable limit, you can submit Form 15G or 15H to avoid the TDS deduction.

Are Dividends from Stock Investments Taxable?

Yes, dividends received from stock investments are taxable in India. They are taxed based on your total income and fall under your income tax slab. If the total dividend income in a financial year exceeds ₹5,000, a 10% TDS is deducted. Form 15G or 15H can be submitted by investors to avoid the TDS deduction if their income is below the taxable limit.

What is the Tax Rate on Dividends from Stocks?

The tax rate on dividends from stock investments depends on your income tax slab. If your dividend income exceeds ₹5,000 in a year, a 10% TDS is applied at source. The TDS can be avoided by submitting Form 15G or 15H if your income is below the taxable limit. Your final tax liability on dividends will be calculated based on your total income and the applicable income tax rate.

How Can You Avoid TDS on Dividends from Stocks?

To avoid TDS on dividends from stock investments, submit Form 15G (for individuals below 60 years) or Form 15H (for senior citizens above 60 years) to your respective banks or brokerage firms. This will help ensure no TDS is deducted if your total income is below the taxable limit. However, the income will still be taxed based on your total income at the time of filing your tax returns.

How Are Foreign Stock Dividends Taxed in India?

Dividends from foreign stocks are also taxable in India. You will need to include them in your total income, and they will be taxed according to your income tax slab. Foreign companies may also deduct taxes at source, but you can claim a foreign tax credit to avoid double taxation. Make sure to report foreign dividend income on your tax returns to stay compliant.