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Dividend Yield Calculator India — FY 2025-26

Calculate dividend yield on any stock, net dividend after TDS and income tax, reconcile TDS refund or shortfall, and compare dividend vs growth mutual fund options. Dividends are taxed at your slab rate since the abolition of DDT in FY 2020-21. TDS at 10% applies under Section 194 when dividend exceeds ₹5,000 per company per year.

Current market price on NSE/BSE
Total dividend declared per share for the year
Total shares you hold in this company
Dividends are taxed at your slab rate since FY 2020-21
Based on your total income

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How to Use This Calculator

Dividend Yield tab

Enter the current market price of the stock (e.g., ₹250), the annual dividend per share (e.g., ₹12), and the number of shares you hold. The calculator computes the dividend yield percentage, gross dividend, TDS deducted under Section 194, tax at your slab rate, and the net dividend you actually receive after tax.

Dividend Tax tab

Enter your total dividend income from all sources — shares, mutual funds, and other investments. Select your income tax slab. The calculator shows TDS deducted at 10%, your actual tax liability at slab rate, and whether you owe additional tax or are due a refund when filing your ITR.

Dividend vs Growth tab

Compare the dividend option (taxed at slab rate every year) with the growth option (taxed at LTCG 12.5% only on redemption). Enter the investment amount, expected return, dividend yield, and holding period. The calculator shows the after-tax value of each option and the tax saving from choosing growth.

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The Formula

Dividend yield and tax are computed as follows:

Dividend Yield:
Dividend Yield (%) = (Annual Dividend per Share ÷ Current Market Price) × 100

Gross Dividend:
Gross Dividend = Annual Dividend per Share × Number of Shares

TDS (Section 194):
TDS = 10% of Gross Dividend (if total dividend from a company > &rupee;5,000/FY)

Tax on Dividend:
Tax = Gross Dividend × Slab Rate + Surcharge + 4% Cess
(Dividends taxed as "Income from Other Sources" since FY 2020-21)

Net Dividend:
Net Dividend = Gross Dividend − Total Tax

Net Yield:
Net Yield (%) = Net Dividend per Share ÷ Market Price × 100

Since the abolition of DDT (Dividend Distribution Tax) in FY 2020-21, dividends are fully taxable in the hands of the recipient at their applicable income tax slab rate. TDS at 10% is deducted at source under Section 194 if the total dividend from a single company exceeds &rupee;5,000 in a financial year.

Example

Priya — holds 500 shares of Coal India, 30% slab taxpayer

Priya holds 500 shares of Coal India Ltd with a current market price of &rupee;400. The company declared a total annual dividend of &rupee;24 per share for FY 2025-26. She is in the 30% tax slab with no surcharge.

Step 1: Calculate dividend yield

Market price per share&rupee;400
Annual dividend per share&rupee;24
Dividend yield6.00%

Step 2: Calculate gross dividend

Shares held500
Gross annual dividend&rupee;12,000

Step 3: Calculate tax

TDS at 10% (Sec 194)&rupee;1,200
Actual tax at 30%&rupee;3,600
Cess (4%)&rupee;144
Total tax&rupee;3,744
Additional tax to pay (beyond TDS)&rupee;2,544

Step 4: Net dividend

Net dividend after tax&rupee;8,256
Net dividend yield4.13%

Despite a headline yield of 6%, Priya's effective yield drops to 4.13% after paying 30% slab tax plus cess. The TDS of &rupee;1,200 is adjusted against her total tax of &rupee;3,744, leaving &rupee;2,544 to pay as self-assessment tax when filing her ITR.

FAQ

Since FY 2020-21 (Finance Act 2020), Dividend Distribution Tax (DDT) has been abolished. Dividends are now taxed in the hands of the recipient at their applicable income tax slab rate. This means if you are in the 30% slab, you pay 30% tax (plus surcharge and 4% cess) on all dividend income. Dividends are classified as "Income from Other Sources" under Section 56(2)(i). This applies to dividends from both Indian companies and mutual funds.
Under Section 194, companies deduct TDS at 10% on dividend payments if the total dividend paid to a shareholder exceeds &rupee;5,000 in a financial year. For mutual fund dividends, Section 194K applies with the same 10% rate and &rupee;5,000 threshold per AMC. If you do not provide your PAN, TDS is deducted at 20%. The TDS is an advance tax that is adjusted against your final tax liability when you file your ITR — if your slab rate is higher than 10%, you pay the shortfall; if lower, you claim a refund.
For most investors in the 20% or 30% slab, the growth option is more tax-efficient. With the dividend option, each payout is taxed at your slab rate (up to 30% + surcharge + cess = ~31.2%). With the growth option for equity mutual funds, you pay no tax until redemption, and if you hold for more than 12 months, gains above &rupee;1,25,000 are taxed at just 12.5% LTCG (Section 112A). The tax deferral benefit compounds over time. However, for investors in the nil or 5% slab, the dividend option may occasionally be comparable. For debt mutual funds, gains are always taxed at slab rate regardless of holding period (since April 2023), so the comparison depends on cash flow needs.
Yes. Under Section 57(i), you can claim a deduction for interest paid on loans taken to acquire the shares or units that generated the dividend income. However, this deduction is capped at 20% of the total dividend income. No other expenses (such as demat charges, brokerage, or advisory fees) are allowed as deductions against dividend income. There is no standard deduction available for dividend income unlike salary income.
A dividend yield of 2-4% is considered reasonable for Indian equities. High-yield stocks like Coal India, ONGC, IOC, Power Grid, and BPCL can offer yields of 5-8%, but very high yields often indicate a fallen stock price or unsustainable payout ratios. The Nifty 50 index has a historical dividend yield of about 1.2-1.5%. When evaluating dividend stocks, also consider the payout ratio (dividends as % of earnings) — a payout ratio above 70-80% may not be sustainable. Blue-chip PSU stocks tend to offer higher yields due to government-mandated dividend policies.

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