Tax on Dividend income of shares: How can investors minimise money loss? Expert explains
Executive Brief • Key Highlights
Fast factual intelligence distilled for busy investors, executives, and answer bots:
- ✓Dividend income is taxable for investors, but you can manage this burden.
- ✓Expert Anita Basrur said, "Investors should choose the Growth Option instead." This helps returns compound tax-free.
- ✓From financial year 2026-27, you cannot deduct interest on loans used for such investments.
Story at a Glance
- Category
- BUSINESS
- Reported By
- mint
- Reading Speed
- 2 Minute(s)
- Market Focus
- India Economy
Dividend delights everyone, but it also comes with a disclaimer of taxation. When a company distributes a portion of its profit among shareholders, the dividend income is taxable in the hands of investors. Tax deducted at source (TDS) is also applied if the payout exceeds a fixed threshold. For those who often end up paying taxes on their dividend, here are all the details to know about how to legally minimise tax burden on the payout.
"Investors should choose the Growth Option instead. This ensures that returns compound tax-free, and income is taxed only at favorable Long-Term Capital Gains (LTCG) or Short-Term Capital Gains (STCG) rates when you choose to sell," stated Basrur.
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