Banco Products (India) Limited has announced the details regarding the Second Interim Dividend for FY 2025-26, declared at Rs. 8/- per equity share (400%). The company issued a formal communication detailing the procedures for Tax Deduction at Source (TDS) applicable to shareholders. Key requirements include timely submission of necessary forms like Form 15G/15H for resident shareholders and documentation for non-resident claims by the Record Date of March 19, 2026.
Dividend Declaration Details
The Board of Directors of Banco Products (India) Limited, in a meeting held on March 13, 2026, declared a Second Interim Dividend for the Financial Year 2025-26. The dividend rate is set at Rs. 8/- (or 400%) per equity share, based on a face value of Rs. 2/- per share. This dividend is payable to shareholders recorded on the Record Date, which is March 19, 2026.
Tax Deduction at Source (TDS) Requirements
In compliance with the Income Tax Act, the company is obligated to deduct tax at source (TDS) at the time of dividend payment. The applicable rate depends on the shareholder’s category and compliance status.
For Resident Shareholders
- TDS will be deducted at 10% under Section 194, unless exempted.
- TDS is NIL if the aggregate dividend distributed to an individual in the financial year does not exceed Rs. 10,000/-.
- Form 15G (for individuals) or Form 15H (for senior citizens) must be submitted to avoid TDS, provided eligibility criteria are met.
- A valid Permanent Account Number (PAN) is mandatory. If PAN is invalid or not linked to Aadhaar, TDS will be deducted at higher rates under Section 206AA.
- Summary of TDS Rates for Residents:
- NIL: For dividends up to Rs. 10,000/- or upon submission of Form 15G/15H with a linked PAN.
- 10%: For other resident shareholders if PAN is provided.
- 20%: If the PAN card is not provided, is unavailable, or is not linked to Aadhaar.
- NIL/Lower Rate: Upon submission of a valid certificate issued under Section 197.
For Non-Resident Shareholders (Including FIIs and FPIs)
Tax must be withheld as per Sections 195 and 196D of the Act. Generally, the rate is 20% (plus surcharge and cess) on the dividend payable.
To avail beneficial rates under the Double Tax Avoidance Agreement (DTAA), non-resident shareholders must submit:
- Self-attested copy of PAN card (if available).
- Self-attested copy of the Tax Residency Certificate (“TRC”).
- Digital Form 10F and a self-declaration regarding treaty eligibility.
- For shareholders from Singapore, evidence regarding the non-applicability of Article 24 of the DTAA must be furnished.
If the required documents for beneficial DTAA rates are incomplete or unsatisfactory, the company will apply the statutory rate of 20% plus applicable surcharge and cess.
Action Required Deadlines and Updates
Shareholders are requested to provide all necessary details and documentation by March 19, 2026, to ensure correct tax determination. The company will not entertain any communication regarding tax determination or deduction after this date.
Updating Shareholder Records
Shareholders holding shares in dematerialized mode must update records (tax status, email, mobile) with their respective Depositories/Participants. Shareholders holding physical shares must provide updated details to the Registrar and Share Transfer Agent, MUFG Intime India Private Limited (MUFG).
Bank Account Updates
For physical shareholders, updating bank details requires submitting a signed covering letter, a cancelled cheque leaf (bearing the shareholder’s name), and a self-attested copy of the PAN card to MUFG. This ensures the dividend is credited directly to the bank account.
Disclaimer: The information provided is for general guidance only. Investors should consult their own tax advisors regarding specific tax implications.
Source: BSE
