ITR Filing: The last date to file Income Tax Return (ITR) for the assessment year 2021-22 is December 31. Therefore, income tax payers are advised to keep in mind certain changes made by the Income Tax Department while filing ITR. Reporting of dividend income while filing ITR is one such change which the taxpayer cannot afford to miss while filing ITR for the year 2021-22. Now, taxpayers have to give quarter-wise details of their dividend income. This will help them save on income tax expenses.
Speaking about the changes in dividend income tax, which taxpayers must remember while filing ITR for AY 2021-22; Amit Gupta, MD, SAG Infotech said, “Before FY2011, dividend income 10 lakh taxpayers in a particular year were not taxable as organizations had to pay Dividend Distribution Tax (DDT) before making dividend payments. However, those who have received dividend of more than 10 lakh used to pay only 10 per cent tax on dividend payment. However, from FY 2011 onwards, the government has made dividend distributed by an organization taxable.”
Advising income taxpayers to report quarter-wise breakup of dividend income while filing ITR for the year 2021-22, Mumbai-based tax and investment expert Balwant Jain said, “Interest for default in payment of advance tax liability In order to calculate the income tax, taxpayers are now required to give quarter-wise details of dividend income received in a financial year. This will help the taxpayer to save income tax expense as taxpayers are now required to pay advance tax in the quarter in which Dividend income has been received.” Balwant Jain further added that even for a normal income tax payer, if there is dividend income, he has to report it in quarter-wise breakup otherwise his ITR form will be rejected.
In line with the views of Balwant Jain; Amit Gupta of SAG Infotech said, “Earlier, there was exclusion from interest penalty for non-payment of advance tax on dividend income as it was not possible to mention dividend income in advance. It is highly likely that dividend income will be provided pre -Filled for taxpayers from this year onwards as Income Tax Department has made it mandatory for organizations to declare the information of dividend paid to the department.It is worth mentioning, if you get the pre-filled data in your ITR, So you should check the information clearly.”
To avoid rejection of one’s ITR form, the taxpayer needs to report the dividend income breakup for the following periods:
1]1st April 2020 to 15th June 2020;
2]16 June 2020 to 15 September;
3]16 September 2020 to 15 December 2020;
4]16 December 2020 to 15 March 2021; And
5]From 16th March 2021 to 31st March 2021.
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