High dividend yield is bad after the abolition of dividend distribution tax. (Earlier companies were paying 10% tax on the amount distributed as tax, but now it is taxed at the hands of investors at their peak tax rate).
Now the sole beneficiary of the dividend distribution is the promoter and the govt. Promoter still pays tax but at lesser rate (10% ??) that too after deducting expenses and if promoter is govt (PSU co) who are they paying taxes to? To themselves?
Retail investors lose out in dividend play, unless you’re someone who doesn’t have any other source of income and hence below any meaningful tax slab.
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