Another expert’s job is the distribution of dividend. It need special attention. To pump in the fund needed by the Companies, the Government made it a liability of the company to pay the dividend on the dividend distributed and to enjoy the receipt of dividend as an exempt income by the investors.
Dividend Distribution Tax ('DDT') is an additional tax payable at 20.36% (including applicable cess and surcharge) by a Domestic Company on its distributed profits. If DDT is not paid within 14 days of declaration/ distribution/ payment of dividend (whichever is the earliest),
- Company would be deemed to be an ‘assessee in default
- Levy of interest at 1% for every month or part of a month, for delay
- Possible imprisonment.
A lot more have to be done in course of dividend distribution, like
- Depositing of the Amount of declared dividend in separate Bank Account.
- Payment of dividend within 30 days of declaration.
- Transfer of unpaid dividend in special account.
- Interest for late payment
- Transfer of Investor protection Fund after Seven year.
- Penalty for non-payment etc.
The accounts of the business, intending to distribute the dividend needs to be streamlined also. We provide the composite services relating to distribution of dividend either in the form of advise or through direct involvement of our experts including the visit to the client’s place of business.