LIC asks shareholders to update PAN, bank details by this date to avoid higher TDS on dividends Dividends will be paid to members who own equity shares of the Corporation, either in physical or electronic form
The Life Insurance Corporation of India (LIC) has advised shareholders to update their Permanent Account Numbers (PANs), according to the LIC advertisement in the newspaper dated July 5, 2024.Dividend details
As per the advertisement, “Members may note that the Board of Directors of the Corporation in its meeting held on May 27, 2024, has recommended a final dividend of Rs 6/- per equity share of face value of Rs 10/- each for the Financial Year 2023-24, subject to declaration of the same by the members of the Corporation at the 3rd Annual General Meeting scheduled to be held on Thursday, August 22, 2024.#sr_widget.onDemand p, #stock_pro.onDemand p{font-size: 14px;line-height: 1.28;} .onDemand .live_stock{left:17px;padding:1px 3px 1px 5px;font-size:12px;font-weight:600;line-height:18px;top:9px} #sr_widget.onDemand .sr_desc{margin:0 auto 0;} #sr_widget.onDemand .sr_desc{color: #024d99;margin-top:10px;} #sr_widget.onDemand .crypto .live_stock .lb-icon{8px 6px 5px 3px !important} #sr_widget.crypto.onDemand a.text{border-bottom:1px solid #ccc;padding-bottom:5px;display:block;width:100%} #sr_widget.onDemand .sr_desc .text p, #stock_pro.onDemand .sr_desc .text p{font-size:12px;font-weight:400;}
LIC shareholders: Who are eligible for dividends
As of the record date, which is Friday, July 19, 2024, dividends will be paid to members who own equity shares of the Corporation, either in real or electronic form. Within 30 days of the dividend declaration date, or by September 20, 2024, at the latest, the final dividend will be distributed to eligible members. Members who have updated their bank account information with their Depository Participants may receive payment through a variety of online and other acceptable methods.TDS on dividend income
The Income Tax Act, 1961 (the "IT Act") mandates that the Corporation deducts tax at source ("TDS") on dividends paid to members. Dividend income is taxable in the hands of the members.To enable compliance with the TDS requirements, LIC members are requested to complete and/or update their residential status, PAN and category as per the IT Act with their DPs
LIC add in the newspaper stated, “Members who have not updated their bank account details are requested to update their Bank Mandate with the respective DPs on or before 05:00 p.m. (IST), Friday, July 19, 2024 to receive dividend directly into their bank account through any permissible mode.”
In case of non-availability of the bank details of any member, LIC shall pay the dividend to such Members through any other permissible mode.
As per the LIC website, “However, no tax shall be deducted on the dividend payable to a Resident Member (Individual), if the total dividend to be received by them during Financial Year 2024-25 (interim, final or by any other name called) does not exceed ?5,000. Where the PAN is either not registered or is invalid, tax shall be deducted at source at a rate which is higher of the prescribed TDS rates or @ 20%.”
Members will also be able to see the credit of TDS in Form 26AS, which can be downloaded from their e-filling account at https://www.incometax.gov.in/iec/foportal.
For Financial Year 2024-25 taxes shall be deducted at source under Section 194 of the IT Act as follows:
Section: 194
Category of Members: Members having valid PAN
Applicable rate requirements : 10% or as notified by the Government of India
Exemption applicability/ Documentation: Update valid PAN if not already done with respective depositories
Section: 206AA
Category of Members: Members not having PAN / invalid PAN; and Members who is Specified Person as per Section 206AB of the Income-tax Act (Refer Point B of this
communication
Applicable rate requirements : 20%
Exemption applicability/ Documentation: Update valid PAN if not already done with
respective depositories.
As per the LIC website, "Further as per Section 139AA of the Act, every person who has been allotted a PAN and who is eligible to obtain Aadhar, shall be required to link the PAN with Aadhar. In case of failure to comply to this, the PAN allotted shall be deemed to be invalid/ inoperative and he shall be liable to all consequences under the Act and tax shall be deducted at higher rates as prescribed under the Act. The Corporation will be relying on the information verified by the utility available on the Income Tax website."
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This story originally appeared on: India Times - Author:Faqs of Insurances
