Dividend income in ITR2

POSTED BY Ramprakash ON July 15, 2012 2:58 pm COMMENTS (5)

Is it mandatory to mention the dividend income (which is after DDT deduction) from shares and Mutual Funds (both debt and equity) in ITR2 in the EI (Exempt Income) worksheet? What are the consequences of NOT mentioning it?

Thanks

5 replies on this article “Dividend income in ITR2”

  1. Dear Ramprakash, although the major part is already answered by dear BanyanFA, there is more to it. Over the period, there may be a situation that your dividend income itself is running in lakhs of Rs. what ‘ll you do then? If you are going to use that money for any major consumption like Car purchase or house purchase or any other high value transaction, the PAN ‘ll be reported compulsorily & at that time Income Tax people ‘ll ask you to reveal the source of funding. So it’s in your interest to reveal your exact income position while filing ITR.

    Thanks

    Ashal

  2. BanyanFA says:

    Good point. I may be able to help you with a solution. Do you have netbanking with ICICI bank (assuming that you already have it considering that you are using icici direct) ?

    Go into your account statements section and take a download of all transactions for past 1 year (2011-12) and take the dump in Excel. You would spot that all dividends will start with a word ‘ECS’. Filter the Excel file’s description column for all cells which begin with ECS and you would have all dividends. Sum them up and you are ready for your return.

    If you still want to ignore the dividend amounts, then it would be your call.

    1. Ramprakash says:

      Thanks BFA.

      That was very helpful in tracing and consolidating the dividends in no time at all.

  3. BanyanFA says:

    Ramprakash,
    It would be better that you mention it under Schedule EI as Dividend Income. You are obliged by law to reflect true position in your tax return. And it does you no harm to mention the details considering the dividends don’t attract tax.

    Consequences – if your return gets picked up in sample scrutiny, then you may unnecessary attract penalty for incorrect disclosures in your tax returns.

    Regards
    BanyanFA

    1. Ramprakash says:

      Thanks BFA.
      Point taken.

      The only reason I asked this was because we do not get a consolidated statement from icicidirect for all the dividends received during the financial year. One has to go through the saving account statement for the year and pick up the dividend credit enteries. And now days since everyone uses debit card for online shopping, malls, atm withdrawals,the statement runs into multiple pages.

      I was also under the impression, if all taxes have been duly paid, no penalty can be levied, even if someone missed it in reporting it in the ITR.

      Thanks

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