IndusInd Bank Limited has issued a comprehensive communication regarding Tax Deduction at Source (TDS) procedures for its recommended final dividend distribution for the financial year ended March 31, 2026.

Dividend Recommendation and Timeline

The Board of Directors recommended a Final Dividend of ₹1.50 per equity share of face value ₹10 each at their meeting held on April 24, 2026. This dividend is subject to approval by shareholders at the ensuing Annual General Meeting to be held in August 2026.

Key Dates:

  • Record Date: Friday, June 26, 2026
  • Last Date for Uploading Tax Exemption Forms: Monday, July 6, 2026
  • Dividend Payment: To be made in electronic form after shareholder approval

TDS Provisions for Resident Shareholders

  • TDS deducted @ 10% under Section 393 of Income Tax Act, 2025 unless exempt
  • No TDS for resident individual shareholders if aggregate dividend during FY 2026-27 does not exceed ₹10,000
  • Form 121 (erstwhile Form 15G/15H) can be submitted for exemption with self-attested PAN copy
  • Specific exemptions available for:
  • Insurance companies (submit declaration + registration certificate + PAN)
  • Mutual Funds (declaration + registration documents + PAN)
  • Alternative Investment Funds (Category I/II AIF under SEBI regulations)
  • New Pension System Trust
  • Other shareholders covered under CBDT Circular No. 18/2017
  • Lower/NIL TDS certificates under section 395 accepted if valid for FY 2026-27

TDS Provisions for Non-Resident Shareholders (including FPIs)

  • Default TDS rate: 20% plus applicable surcharge and cess
  • DTAA benefits available upon submission of:
  • Self-attested PAN copy (if allotted)
  • Tax Residency Certificate (TRC) for FY 2026-27
  • Electronically generated Form 41 from Income Tax portal
  • Self-declaration of DTAA eligibility and beneficial ownership
  • SEBI registration certificate (for FPIs)
  • Limitation of Relief evidence (for Singapore and other countries)

Special Categories:

  • Alternative Investment Fund - Category III in IFSC: 10% TDS
  • Sovereign Wealth Funds and Pension Funds under Schedule V(7): NIL TDS
  • Offshore Banking Unit as Category-I FPI: 10% TDS
  • Subsidiary of Abu Dhabi Investment Authority (ADIA): NIL TDS

TDS Summary Rates

  • NIL: Resident individuals receiving ≤ ₹10,000 dividend or submitting Form 121
  • 10%: Other resident shareholders with valid PAN
  • 20%: Resident shareholders without PAN/inoperative PAN
  • 20% + surcharge/cess: Non-residents without required documents
  • Lower/NIL: With valid section 395 certificate
  • 10% + surcharge/cess: AIF Category III in IFSC/Offshore Banking Unit Category-I FPI
  • NIL: Entities covered under Schedule V(7) with valid PAN

General Information

  • Declaration under Rule 203 of Income Tax Rules 2026 must be filed if dividend income assessable by person other than deductee
  • Bank reserves right to deduct taxes at higher rate if declarations found inaccurate
  • No claims against Bank for excess taxes deducted - refunds must be claimed via income tax returns
  • Higher tax rate applied across all accounts if shareholder holds under multiple residential statuses with single PAN
  • Shareholders responsible for indemnifying Bank against any tax demands arising from misrepresentation

Documentation Requirements

All documents must be uploaded by July 6, 2026 with MUFG Intime India Private Limited (formerly Link Intime India Private Limited) through specified online links. Documents sent to other email IDs will not be accepted.

KYC and Bank Account Updates

  • Demat shareholders must update PAN, email, mobile numbers, bank details through Depository Participants
  • Physical folio shareholders must submit KYC forms to RTA
  • SEBI mandate: Dividend for physical shareholders paid only electronically from April 1, 2024, requiring PAN, nomination, contact details, bank account details, and specimen signature
  • Physical shareholders must submit scanned covering letter, cancelled cheque leaf (with name), and self-attested PAN copy

Financial Impact

Financial impact not quantified in the disclosure. The communication outlines procedural requirements for TDS compliance on the recommended dividend distribution.