Why is the divided amount credited lower than the declared dividend?

The dividend credited to a bank account may be lower than the declared amount due to Tax Deducted at Source (TDS). The applicable deduction depends on the shareholder’s residential status, dividend amount, PAN details and eligibility for tax relief.

Applicable TDS rules from 1 April 2026:

Shareholder category	TDS rate and threshold
Resident individual	10% if the applicable ₹10,000 annual threshold is exceeded, subject to prescribed conditions.
Resident non-individual (company, HUF or partnership firm)	Generally, 10%, with no general minimum threshold
Non-resident shareholder (including NRI)	Generally, 20%, subject to applicable tax treaty benefits and conditions

Under the Income-tax Act, 2025, effective 1 April 2026, eligible resident individuals may submit Form 121 to request nil or lower TDS, subject to prescribed conditions. Missing or invalid PAN details may result in a higher deduction.

The dividend payment advice issued by the company or its Registrar and Transfer Agent (RTA) can be checked to verify the gross dividend and TDS deducted. For discrepancies, the RTA may be contacted. TDS is a tax credit and does not necessarily represent the final tax liability.

What should be checked if the dividend credited does not match the expected amount?

Check the dividend payment advice issued by the company or its RTA to confirm the gross dividend, TDS deducted, and net amount payable. Verify that the PAN, bank account, and other required details are correctly recorded. For any discrepancy, contact the company’s RTA with the dividend payment details.

TDS is a tax credit and does not necessarily represent the final tax liability. Dividend income must be reported in accordance with the applicable income-tax provisions, and eligible TDS credit may be claimed while calculating the final tax liability.

Resolve Failed Payments

Learn the steps to resolve failed dividend payments and claim outstanding amounts.

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