Received dividend in FY20-21? Know the new rules before filing ITR

From FY20-21, the government has made dividend distributed by a company taxable in the hands of the investors. Prior to that, companies used to deduct dividend distribution tax (DDT) before declaring dividend to investors. Therefore, dividend received was tax-free in the hands of the investors, while those who received dividends over Rs10 lakh were taxed at 10%.

Along with the rules, reporting of the dividend in the income tax return (ITR) has also changed. Earlier the dividend was to be shown under 'Exempted Income' whereas now it should be shown under 'Income from other sources'.